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The Department of Justice has dropped its campaign finance violation charge against disgraced FTX founder and Biden donor Sam Bankman-Fried.
What's the background?
Following the November 2022 collapse of his former cryptocurrency exchange FTX, Democratic megadonor Bankman-Fried was hit with eight charges of fraud and conspiracy, including a campaign finance charge.
U.S. Attorney Damian Williams of the Southern District of New York wrote in a December 2022 letter to District Judge Ronnie Abrams, "The Government expects the evidence will show that the defendant violated campaign finance laws by causing political contributions to candidates and committees ... to be made in the names of co-conspirators, when in fact those contributions ere funded by Alameda Research with misappropriated customer funds."
Williams indicated this alleged scheme enabled the Democratic megadonor to evade "contribution dollar limits, corporate donation limits, and donation reporting requirements."
TheBlaze previously detailed how an indictment, unsealed in February in the U.S. District Court for the Southern District of New York, suggested that Bankman-Fried and "co-conspirators made over 300 political contributions, totaling tens of millions of dollars, that were unlawful because they were made in the name of a straw donor or paid for with corporate funds" (i.e., unsuspecting clients' money).
The indictment further accused the Democratic megadonor of seeking to acquire influence by way of these allegedly "unlawful political contributions" as well as 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."
These efforts appears to have been extra to his ostensibly above-board donations.
Bankman-Fried reportedly donated $10 million to then-candidate Joe Biden in 2020.
The crypto hustler reportedly also hired a network of "political operatives" and spent at least $39,826,856 in an effort to help Democrats win their House races in the November 2022 midterm elections.
Among his beneficiaries were Democratic Sens. Kirsten Gillibrand (D-N.Y.), Cory Booker (D-N.J), and Chuck Schumer (D-N.Y) and former House Speaker Nancy Pelosi (D-Calif.).
Bankman-Fried told Jacob Goldstein of "What's Your Problem?" that he planned to possibly donate "north of $100 million" and up to $1 billion to Democrats in the 2024 presidential elections.
Bankman was extradited from the Bahamas back to the United States on December 21, 2022.
Biden DOJ drops charges
Forbes reported that the Biden DOJ will not pursue a campaign finance charge against Bankman-Fried as a means of placating the Bahamas, which has claimed this charge was not part of its initial extradition agreement with America.
In a Wednesday letter to U.S. District Judge Lewis A. Kaplan, U.S. Attorney Williams indicated that Bankman-Fried had moved to dismiss the conspiracy to make unlawful campaign contributions count on "rule of specialty grounds," but that this had been rejected.
While this motion had been rejected, Williams noted the DOJ subsequently "informed the Court that the United States had sought clarification from The Bahamas regarding whether this count was included in the defendant's extradition."
The Bahamas purportedly came back suggesting it had not intended to extradite the disgraced Democratic megadonor "on the campaign contributions count."
Williams wrote, "In keeping with its treaty obligations to The Bahamas, the Government does not intend to proceed to trial on the campaign contributions count."
Prosecutors removed five other charges against Bankman-Fried last month, punting them to 2024 after a Bahamas court ruling suggested the DOJ may have fouled up the procedure for charging the former billionaire, reported CNBC.
According to the New York Times, Bankman-Fried is now left only facing seven charges at his trial in October, although he will likely face the five punted charges at a subsequent trial.
John P. Fishwick Jr., a former U.S. attorney for the Western District of Virginia, told the Times prosecutors still had "overwhelming evidence against Sam Bankman-Fried" and that he still could face dozens of years behind bars.
reported that Judge Kaplan tightened Bankman-Fried's bail conditions Wednesday, hitting him with a gag order after he had shared his former lover Caroline Ellison's personal writings with the press, which prosecutors said amounted to more witness tampering.
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Joseph MacKinnon is a staff writer for Blaze News.