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Ryan Salame, the former co-CEO of FTX’s Bahamian subsidiary and a top official to Sam Bankman-Fried, has admitted to receiving millions of dollars in illegal campaign funds to support his boss’ political goals.
Salame, Bankman-Fried, and former FTX engineering chief Nishad Singh were accused by prosecutors of using FDI revenue to support political candidates who supported crypto-friendly legislation in court filings on Thursday.
Salame was among the four ex-executives to have admitted guilt. Bankman-Fried is set to stand trial on October 3 for allegedly stealing billions of dollars from FTX customers to cover up their losses at Alameda Research, his hedge fund.
Salame, aged 30, confessed to one count of conspiracy to make illegal political donations and one charge of conspiring to operate an unlicensed money transmitting business during a hearing before U.S. District Judge Lewis Kaplan in Manhattan.
Salame was not believed to be cooperating with the prosecution or preparing to testify against Bankman-Fried.
Caroline Ellison, Gary Wang, and Nishad Singh, who were previously appointed Alameda Chief Executive Officer and former FTX technology chiefs, have admitted guilt and are scheduled to testify.
Salame’s attorney, Jason Linder of Mayer Brown law firm, stated in a statement that Ryan is eager to move beyond this period and start his new life.
Previously, Bankman-Fried, aged 31, has denied charges of fraud and conspiracy in relation to the collapse of FTX in November 2022.
Prosecutors claimed that Salame had told a friend that Bankman-Fried was hoping political donations would “weed out” anti-crypto Democratic and Republican lawmakers, which would ultimately lead to their defeat in elections.
Salame’s contributions to Republican candidates and causes in the 2022 election cycle surpassed $24 million, as per Federal Election Commision data, placing him among the most generous donors.
He stated in court that the money he borrowed was recorded as loans from Alameda, but recollectively, ‘I have no intention of repaying them’.
“I was aware that it was against campaign finance regulations to donate money to me without my permission,” Salame stated.
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In 2019, Salame became the first employee of Alameda after two years. He joined the company in late 2021 and went on to become co-chief executive of FTX’s Bahamian affiliate, having previously worked at Ernst & Young and Circle Internet Financial before joining FEDERAL Markets.
Salame claimed that he utilized the fund’s bank accounts to facilitate the transfer of fiat currency among FTX customers at the exchange, despite the fact that neither company was legally licensed as a money services business.
Damian Williams, the U.S. Attorney in Manhattan, stated on Thursday that FTX’s campaign finance and money transmitting schemes had contributed to its rapid and significant growth by operating outside the law.
As part of his plea bargain, Salame surrendered over $1.5 billion, but prosecutors will accept his payment of $6 million, two Massachusetts real estate properties, his interest in East Rood Farm, and a 2021 Porsche to satisfy the verdict.
The Berkshire Eagle’s 2021 report states that Salame has a tavern in Lenox, Massachusetts, which is owned by East Rood.
Salame has agreed to pay $5.6 million in reparations to FTX during its ongoing bankruptcy proceedings.
Salame was incarcerated and released on $1 million bond, with his sentencing set for March 6, 2024.
Luc Cohen was responsible for reporting from New York, while Editorial Credits were given by Will Dunham, Emelia Sithole-Matarise, Mark Porter, David Gregorio, and Leslie Adler.
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