Sam Bankman-Fried Funded 'Woke Shit for Transactional Purposes,' Prosecutors Allege

Prosecutors have filed a new superseding indictment against former FTX CEO Sam Bankman-Fried, hitting the disgraced crypto wunderkind with four new charges and giving further insight into the allegations against him. 

Notably, the indictment alleges that an unnamed executive at the company, which before its collapse built a hyperbolically benevolent reputation for philanthropy, conspired to make political donations to "woke shit for transactional purposes.”

Bankman-Fried is alleged to have massively defrauded customers of his now-bankrupt FTX empire. FTX presented itself as a cryptocurrency exchange, but prosecutors now accuse it of essentially operating as a slush fund made up of customers' commingled deposits that was used to fuel Alameda Research, a sister hedge fund founded by Bankman-Fried that went belly-up, to enrich the former CEO and his alleged co-conspirators via loans, and to make illegal political donations on both sides of the aisle. 

The former CEO's political donations were legendary even before his arrest. He was known to be a top donor and gained influence in Washington by presenting himself as essentially benevolent and ethical—a humble person who planned to give away his billions to solve the world's problems—using that influence to push legislation that would regulate the crypto industry. However, the criminal charges against him accuse him of operating a wide-ranging scheme to violate campaign finance laws by making hundreds of donations funding candidates using stand-ins during the 2022 midterms. 

Bankman-Fried "perpetuated his campaign finance scheme at least in part to improve his personal standing in Washington, D.C., increase FTX's profile, and curry favor with candidates that could help pass legislation favorable to FTX or Bankman-Fried's personal agenda, including legislation concerning regulatory oversight over FTX and its industry," the fresh indictment states. "To accomplish these goals, Bankman-Fried caused substantial contributions to be made in support of candidates of both major political parties and across the political spectrum. Bankman-Fried, however, did not want to be known as a left-leaning partisan, or to have his name publicly attached to Republican candidates." So, prosecutors allege, he and his co-conspirators cooked up a scheme to make donations via other FTX executives. 

One unnamed executive in particular, the indictment alleges, was selected "to be the face of Bankman-Fried's and FTX's more left-leaning spending," and ultimately became one of the largest Democratic donors in the 2022 midterms. 

Prosecutors allege that Bankman-Fried and co-conspirators decided to donate "at least a million dollars" to a super PAC supporting a Congressional candidate that "appeared to be affiliated with pro-LGBTQ issues," and selected this unnamed executive as the person to donate the funds. According to the indictment, a political consultant working for the group told the unnamed executive, "in general, you being the center left face of our spending will mean you giving to a lot of woke shit for transactional purposes." 

The executive was uncomfortable with this, the indictment alleges, but agreed to do it because there was no one "trusted at FTX [who was] bi/gay."

The phrase "giving to a lot of woke shit for transactional purposes" is notable, because Bankman-Fried's public image traded on his supposed benevolence. He was a major figure in the effective altruism movement, which holds that wealthy people today should direct their capital towards benefitting the largest number of people possible in the far future. The allegations instead paint a picture of someone who's scruples begin and end at furthering their own agenda, with even progressive causes being subsumed into this goal. 

In total, Sam Bankman-Fried and co-conspirators donated millions to both Democrat and Republican candidates, amounting to over 300 donations, prosecutors allege.