FTX creditors are seeking to reclaim hundreds of thousands of dollars given to US political action committees (PACs) and political figures. In order to ask for the money back, confidential letters were sent to individuals and organisations. The deadline for this is February 28, 2023. Some politicians, such as Democratic Sens. Joe Manchin and Tina Smith, have already pledged the funds. It is not clear if they will be required to return the money to the now bankrupt FTX estate.

US Political Elite Pressured to Repay FTX Contributions Before Deadline

It is well known that legislators in WashingtonDC, and the nation’s political action committees, received significant funding from FTX. Sam Bankman-Fried (SBF), and senior executives, were responsible for donating around $90 million to US politicians, political groups, and US bureaucrats for the setup and running of the exchange. For example, SBF and ex-FTX executives Nishad Singh and Ryan Salame provided an estimated $70.1 million to the Democratic and Republican parties for the 2022 midterm election cycle.

A press release dated February 5, states that FTX’s creditors intend to reclaim funds from WashingtonDC’s political elite. The announcement reads: “FTX creditors are sending confidential messages to political figures, political action committees, and other recipients of contributions or payments made by or at the direction of FTX creditors, Samuel Bankman-Fried, or other executives.” Additionally, it goes on to say that “recipients are requested to return funds to FTX creditors by February 28, 2023.”

FTX creditors state that the money can be returned to them through a designated email account by the specified date. The bankrupt estate declares that it reserves the right to “initiate actions in bankruptcy court to request the return of these payments, including the interest accrued from the date of initiation.” The FTX Creditors’ Press Release was accompanied by a list of US politicians believed to have received funds from SBF executives and top FTX officials. The “Unusual Whales” Twitter account tweeted: “There was no list of the politicians they gave money to, and the amounts, until now.”

The release of the list of US politicians who accepted money from FTX executives was followed by a press release. Some politicians chose to redirect the donations to charity. For instance, Republican Senators John Boozman and Bill Cassidy announced their intention to donate the funds. Democratic Senators Joe Manchin and Tina Smith donated additional funds to certain charities following the collapse of FTX. Smith, a Democrat from Minnesota, told the press she had “serious concerns about cryptocurrency and the financial risks it poses to retail investors.” However, during the election cycle Minnesota Rep. Angie Craig and Sen. Tina Smith accepted $2,900 when the exchange was still operational. It is not clear who these politicians were or why they chose to donate the funds to charity rather than returning them to the bankrupt creditors who owe billions of dollars to the retail traders these politicians claim they care about.

Are you interested in the action by FTX creditors to reclaim funds from US politicians and action committees? Let us know in the comments section below what topic you are most interested in.