FTX accuses Sam Bankman-Fried’s mother of being her son’s primary advisor regarding political contributions

The mother of former cryptocurrency king Sam Bankman Fried is accused, in a new lawsuit, of serving as a key advisor to her son and his allies on political campaign contributions that later led to criminal charges against him and others.

the complaintfiled on Monday by the now-bankrupt FTX cryptocurrency exchange, accuses Barbara Fried of being a “person of interest” in her son Bankman Fried’s “political contribution strategy.”

She says Freed, concerned about seeing her son help fund causes she supported, encouraged Bankman-Friend and those close to him to “avoid (if not violate) federal campaign finance disclosure rules by engaging in informal or other donations.” Hide FTX group as source of contributions.”

Lawyers for Fried and her husband, Sam Bankman, told CNBC: “These… [FTX] “The allegations are completely false.”

FTX’s lawsuit in U.S. Bankruptcy Court in Delaware seeks to recover millions of dollars that it claims were fraudulently transferred to Fried and Bankman, two law professors at Stanford University.

Their son, Bankman Fried, was CEO of FTX before he was criminally charged with, among other things, embezzling client funds to make tens of millions of dollars in political contributions and making donations in other people’s names.

The superseding indictment alleges that Bankman-Fried used client funds to make more than $100 million in campaign contributions for the 2022 midterm elections.

He has pleaded not guilty in the case, which is scheduled to go to trial next month in federal court in Manhattan.

Fried was not named as a defendant in any of the criminal indictments against her son.

But according to FTX’s new civil complaint, she was critically influential in the donation strategy for her son’s political campaign.

Fried, according to the FTX complaint, described herself as Bankman-Fried’s accomplice in a non-criminal type crime. “

“Bankman-Fried informed several FTX Group employees of his intention to rely on his mother’s guidance regarding political contributions — recipients of contributions, amounts, and disclosure requirements — and encouraged them to follow Fried’s advice as well,” the lawsuit said.

FTX alleges that Fried used her influence over her son and others close to him to help fund her former political operation in a political action committee called Mind the Gap, and associated causes.

Fried helped run the political action committee before resigning last year in the wake of her son’s arrest.

It is said that PAC Actions As a donor advisory group. In 2021, it received a $1 million donation in the name of former FTX engineering director Nishad Singh, according to Federal Election Commission records.

This contribution may not have been from Singh himself, but rather from Bankman Fried, according to the complaint.

The lawsuit cites a 2021 email from Fried to Singh and her son, suggesting the donation be in Singh’s name rather than Bankman-Fried’s name.

“Since this is going to our number 527, and thus has been disclosed, I assume Nishad would be the best person to have his name on it,” Freed wrote in an email, according to the complaint.

“We had a slight preference for that on our part, now that my relationship with Sam was publicly known, because we didn’t want to create the impression that financing MTG was a family affair, as opposed to a collective effort by many people (including some mystery man Nishad Singh 🙂 ),” Fried wrote, adding a smiley face emoji, according to the suit.

Bankman-Fried responded to that email by writing: “It suits me on all fronts.”

“Sounds good, I am happy to pledge $1 million to run MTG, agreed upon for the optics,” Singh replied. [sic]. Would you mind sending wire instructions?” according to the complaint.

There are no recorded contributions to Mind the Gap under the name Bankman-Fried in FEC records.

Singh pleaded guilty last February to criminal charges, including violating campaign finance laws.

The complaint says Mind the Gap relied on Bankman-Fried, Singh and FTX Group to fund the group and related causes. Bankman-Fried’s mother is accused of asking her son and Singh to help fund Mind the Gap or their supported causes.

“MTG relied on FTX Group, Bankman-Fried, and Singh as sources of financing, often ‘claiming’ Bankman-Fried or Singh for funds they had previously committed and, in at least one case, for funds that Fried had unilaterally committed on behalf of Bankman-Fried.” “,” the lawsuit says.

“At Fried’s express request, Bankman Fried and Singh contributed tens of millions of dollars to causes supported by MTG or MTG,” the suit says.

“At times, Fried Bankman committed Fried and Singh to supporting programs supported by MTG to ensure that MTG would meet its financing goals, and they repeatedly demanded these assurances,” according to the lawsuit.