Recipients of FTX founder Sam Bankman-Fried’s political contributions who rushed to offload those funds to charity could still be on the hook for that money.
Bankman-Fried, 30, and others associated with FTX donated millions of dollars to campaigns, political action committees, and individual candidates before his cryptocurrency company’s spectacular collapse. The sudden implosion resulted in many politicians and groups, fearing a public relations nightmare, donating the amount that was given to them to various charities.
But, given the bankruptcy process, the bankruptcy trustee may come knocking and ask for that money back. If those funds were already donated away, the recipient of the contributions may be forced to cut a check or face a suit by the trustee to wrest it back.
Doug Kelley is a Minnesota lawyer who was appointed to recover money lost from Petters Group Worldwide, which was operated by CEO Tom Petters, who was convicted of business fraud more than a decade ago. A Ponzi scheme run by Petters resulted in more than $2 billion in stolen funds, which Kelley was tasked with clawing back.
Kelley explained that politicians shouldn’t just be giving away Bankman-Fried’s contributions given the likelihood that they will be compelled to return them. In the…
