FTX Is Trying to Recover Charitable Donations, Political Contributions

By | December 20, 2022
  • FTX is trying to claw back donations and political contributions to pay creditors.
  • Founder Sam Bankman-Fried made over $46 million in political contributions leading up to FTX’s bankruptcy.
  • Former Representative Beto O’Rourke said he returned a $1 million donation to Bankman-Fried last month.

Failed crypto exchange FTX is trying to recover funds to pay creditors, even if that means clawing back millions in political and charitable contributions.

The exchange said it has already been approached by a “number of recipients of contributions or other payments” made by disgraced founder Bankman-Fried or other FTX officers.

“These recipients have requested directions for the return of such funds,” FTX said in a statements on Monday, adding that the firm is “working with these recipients to secure the prompt return of such funds.”

FTX and sister trading firm Alameda Research made a total of $46.2 million in bipartisan political contributions leading up to FTX’s bankruptcy, according to non-profit OpenSecrets.orgwhich has a public spreadsheet tracking FTX’s top execs’ donations including Bankman-Fried’s.

Bankman-Fried vowed to give billions to charity in his lifetime in the name of effective altruism, which the fallen founder later described as a public relations stunt. FTX Future Fund, one of the exchange’s philanthropic arms, previously said it was going to deploy $1 billion total at a rate of $100 million per year.

If contributions are not returned “voluntarily,” FTX will “commence actions before the Bankruptcy Court to require the return of such payments,” the exchange said.

Politician have started to donate the money received from Bankman-Fried to charities. This includes former Representative Beto O’Rourke, Representative Jesus Garcia, Senator Kirsten Gillibrand, Senator Dick Durbin, and Senator John Boozman.

Texas Democrat O’Rourke said he returned a $1 million donation to Bankman-Fried before FTX filed for bankruptcy protection last month.

“Recipients are cautioned that making a payment or donation to a third party (including a charity) in the amount of any payment received from a FTX Contributor does not prevent the FTX Debtors from seeking recovery from the recipient or any subsequent transferee,” the bankrupt exchange added.

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