Beleaguered Crypto Billionaire Was Hobnobbing at White House Just Six Months Ago

Sam Bankman-Fried is under investigation for mishandling customer deposits as his company implodes

Sam Bankman-Fried / Getty Images
November 11, 2022

A cryptocurrency billionaire facing federal investigation for mishandling customer funds had high-level White House meetings just months ago, as Congress was debating how to regulate his company—and just weeks before he pledged to donate up to $1 billion to Democrats ahead of the midterm campaign.

Sam Bankman-Fried, the owner of cryptocurrency exchange FTX, met on April 22 and May 12 with top Biden adviser Steve Ricchetti, according to White House visitor logs reviewed by the Washington Free Beacon. At the time, FTX was lobbying Congress and federal agencies to shape regulation of the crypto industry.

The meetings are likely to raise questions about the extent to which Bankman-Fried used the promise of political donations to nudge Democrats toward helping his firm. FTX is teetering on the brink of insolvency after announcing it could not fulfill its customers’ withdrawal request due to lack of funds. Bankman-Fried lost nearly all of his $16 billion fortune in the liquidity crunch. And his troubles might get worse. The Securities and Exchange Commission and Commodity Futures Trading Commission are investigating whether FTX mishandled customer deposits in order to prop up the 30-year-old entrepreneur’s hedge fund, Alameda Research, according to Bloomberg News.

It is a remarkable fall for Bankman-Fried, who has emerged as one of the Democratic Party’s biggest campaign donors. He gave more than $5 million to Biden’s 2020 presidential campaign, and has given millions more this cycle to the Democratic Party. In early May, between his first two visits to the White House, Bankman-Fried doled out $865,000 to the DNC, according to Federal Election Commission records. Earlier, in March, he cut three checks totalling $66,500 to the Democratic Senate Campaign Committee, and later in June he sent $250,000 to the Democratic Congressional Campaign Committee.

He said in June, weeks after his most recent White House meeting, that he might give up to $1 billion to support Democrats in the midterms, though he backed away from that pledge in September.

Amid the political spending, Bankman-Fried has led an aggressive lobbying campaign in Washington related to cryptocurrency regulation. He met with Ricchetti, the White House counselor, on April 22 and May 12, according to visitor logs. He met on May 13 with Charlotte Butash, a policy adviser to the White House deputy chief of staff.

Bankman-Fried was accompanied in some of the meetings by Mark Wetjen, the head of policy and regulatory strategy at FTX, who served as commissioner on the Commodity Futures Trading Commission under former president Barack Obama. Eliora Katz, FTX’s chief lobbyist, also attended the meetings but did not mention lobbying the White House in disclosures filed with Congress.

Bankman-Fried’s meetings came weeks after White House officials met with his brother, who directs the billionaire’s political operations. Gabe Bankman-Fried visited the White House on March 7 along with Jenna Narayanan, a Democratic strategist who once worked for Tom Steyer and the Democracy Alliance, a network of wealthy liberal donors who fund left-wing causes. Gabe also attended the May 13 meeting with his brother and FTX’s lobbyists.

Bankman-Fried has made no secret of his plans to influence policymakers. He told former White House communications director Anthony Scaramucci in an interview last month that he has traveled to Washington, D.C., "every two or three weeks for the last year" to lobby for cryptocurrency regulations. Omitting the fact that he had donated significant amounts of money to the lawmakers he lobbied, Bankman-Fried said he was pleasantly surprised at the progress he had made.

"We've been working with Congress to draft legislation that would codify that there is licensure for these assets. I'm actually surprisingly optimistic that will actually happen," he said.

Bankman-Fried has lobbied for a bill proposed by Senate Agriculture Committee chair Debbie Stabenow (D., Mich.) that would put the Commodity Futures Trading Commission in charge of crypto regulation. Bankman-Fried donated $5,800 to Stabenow’s campaign in February, and $20,800 to her joint fundraising committee in January. Bankman-Fried contributed to other Democratic members of the committee amid his lobbying campaign. He sent a combined $31,000 to campaigns and joint fundraising committees tied to Sens. Cory Booker (D., N.J.), Tina Smith (D., Minn.), Dick Durbin (D., Ill.), and Kirsten Gillibrand (D., N.Y.) from October 2021 through June.

Bankman-Fried also contributed to top Republicans on the Senate Agriculture Committee. The crypto billionaire gave $5,800 each to ranking member John Boozman (R., Ark.)  and Sen. John Hoeven (R., N.D.) in January and June, respectively.

Bankman-Fried’s competitors in the crypto space have long been suspicious of his lobbying efforts and his claims to want federal oversight and regulation of the crypto market.

Yaël Ossowski, a crypto currency watchdog at the Consumer Choice Center, warned lawmakers in late October that Bankman-Fried was trying to regulate away his smaller competitors.

Others have expressed skepticism that Bankman-Fried is pushing to have the Commodity Futures Trading Commission oversee cryptocurrency regulation instead of the Securities Exchange Commission, which has stronger enforcement powers and a much larger budget.

FTX and the White House did not respond to requests for comment.