Sam Bankman-Fried (SBF), the founder of the now-defunct crypto exchange FTX, faces mounting legal pressure as emails reveal his family’s alleged role in a $100 million political donation scandal.

According to a recent Wall Street Journal (WSJ) report, emails expose SBF’s family as key players in channeling over $100 million in what appears to be misappropriated FTX customer funds toward influencing the 2022 elections. These revelations have triggered legal proceedings, raising serious questions about potential campaign finance violations.

The report details the involvement of SBF’s father, Joe Bankman, who is alleged to have provided strategic advice on these political contributions. Emails, according to the WSJ, suggest Joe Bankman’s direct participation in the alleged scheme. Additionally, the report implicates SBF’s mother, Barbara Fried, and brother, Gabriel Bankman-Fried, in directing these funds toward various political entities.

Barbara Fried, co-founder of the super PAC Mind the Gap, is alleged to have steered funds towards progressive causes, while Gabriel Bankman-Fried is said to have directed donations towards pandemic prevention efforts.

David Mason, a former chairman of the Federal Election Commission, expressed concern about Joe Bankman’s potential legal liability. He cited the emails as containing “strong evidence” suggesting Joe Backman’s awareness of an “illegal straw-donor scheme.” A spokesperson for Joe Bankman, however, denied any knowledge of campaign finance violations.

The FTX saga continues to unfold, with legal consequences. Former FTX Digital Markets co-CEO Ryan Salame received a 7.5-year prison sentence in May 2024 after pleading guilty to felony charges related to operating an unlicensed money-transmitting business and engaging in campaign finance fraud. Salame’s sentencing follows similar pleas and pending sentences for former executives Caroline Ellison and Nishad Singh.

As investigations delve deeper, the extent of the family’s involvement and potential legal repercussions for SBF and his inner circle remain to be seen.

By Joadin Maina

Beyond the hype, I untangle the web3 revolution, guiding curious minds through the labyrinth of decentralized possibilities.