Former FTX Co-CEO Pleads Guilty to Unlawful Campaign Donations in Boost for Founder
September 7, 2024
In a significant development in the ongoing legal battle surrounding FTX, Ryan Salame, the former co-CEO of FTX’s Bahamian subsidiary, has pleaded guilty to charges related to making unlawful campaign donations. Salame, a trusted lieutenant to FTX founder Sam Bankman-Fried, admitted to making tens of millions of dollars in illegal contributions to support causes favored by Bankman-Fried.
According to court filings, Salame, along with Bankman-Fried and former FTX engineering chief Nishad Singh, used FTX customer funds to donate to political candidates who advocated for crypto-friendly legislation. Salame’s guilty plea comes after three other former executives from Bankman-Fried’s companies have already admitted their involvement in similar schemes.
Bankman-Fried is set to stand trial on October 3 on charges of using billions of dollars in FTX customer funds to cover losses at his hedge fund, Alameda Research. However, there is no indication that Salame is cooperating with the prosecution or planning to testify against Bankman-Fried.
At the hearing before U.S. District Judge Lewis Kaplan in Manhattan, Salame pleaded guilty to one count of conspiracy to make unlawful political contributions and one count of conspiracy to operate an unlicensed money transmitting business. His lawyer, Jason Linder of Mayer Brown, stated that Salame is eager to move forward with his life and put this chapter behind him.
Meanwhile, Bankman-Fried, who previously pleaded not guilty to fraud and conspiracy charges stemming from FTX’s collapse in November 2022, awaits his trial. Prosecutors claim that Salame revealed Bankman-Fried’s intention to use political donations to “weed out” anti-crypto lawmakers from both the Democratic and Republican parties, indicating a desire to defeat them in elections. Salame also admitted to donating over $24 million to Republican candidates and causes during the 2022 election cycle.
As part of the plea deal, Salame has agreed to forfeit more than $1.5 billion. However, prosecutors will accept the surrender of $6 million, two Massachusetts properties, his interest in a company called East Rood Farm, and a 2021 Porsche to satisfy the judgment. Salame will also pay $5.6 million in restitution to FTX as part of the ongoing bankruptcy proceedings.
Salame, 30, was released on a $1 million bond and is scheduled to be sentenced on March 6, 2024.
FTX, once a prominent cryptocurrency exchange, has faced significant legal challenges as its founder and several executives have been implicated in various illegal activities. The outcome of Bankman-Fried’s trial is eagerly awaited as it may further uncover the extent of wrongdoing within the company.
Reporting by Luc Cohen in New York; Editing by Will Dunham, Emelia Sithole-Matarise, Mark Porter, David Gregorio, and Leslie Adler