FTX debtors want political donations returned by end of the month

Troubled crypto exchange FTX is asking political figures and groups to return donations linked to former CEO Sam Bankman-Fried and other FTX executives by the end of February.

FTX is sending confidential notices to political figures, political action groups and other recipients of contributions and payments, the exchange said. The crypto exchange filed for bankruptcy protection in November.

The FTX debtors are reviewing $93 million in political donations made between March 2020 and November 2022, according to court documents filed in January. Bankman-Fried has pleaded not guilty to breaking campaign finance laws, among other charges, in a separate criminal case. 

Some political groups who received FTX-linked funds have already taken steps to return the money. The Democratic National Committee, along with the party’s key Senate and House campaign committees, said in December that they would set aside more than $1 million in cash linked to FTX and return it at the direction of bankruptcy lawyers. 

Some individual lawmakers who received donations linked to FTX took steps to symbolically distance themselves from the exchange by donating the money to charity. That won’t stop bankruptcy lawyers from seeking to claw back the funds, FTX warned. 

“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,” FTX said.

Disclaimer: Beginning in 2021, Michael McCaffrey, the former CEO and majority owner of The Block, took a series of loans from founder and former FTX and Alameda CEO Sam Bankman-Fried. McCaffrey resigned from the company in December 2022 after failing to disclose those transactions.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Source: https://www.theblock.co/post/208763/ftx-debtors-want-political-donations-returned-by-end-of-the-month?utm_source=rss&utm_medium=rss