Bankrupt crypto exchange FTX has confirmed it will send “confidential letters” to politicians and recipients of donations from disgraced ex-FTX chief executive Sam Bankman-Fried. The letters will request mail recipients to return donated funds by the end of the month.
Debtors of the now-defunct cryptocurrency platform have said they “reserve the right” to enforce repayments of the money with legal action.
FTX Group said in its statement: “To the extent such payments are not returned voluntarily, the FTX Debtors reserve the right to commence actions before the Bankruptcy Court to require the return of such payments, with interest accruing from the date any action is commenced.”
The news comes amid a major scandal involving millions in estimated funds sent to political donation recipients. Following its collapse, FTX’s donor scheme triggered a probe from UK regulators in a bid to return the misappropriated funds.
Britain’s Charity Commission said on 2 February that it had launched investigations over FTX’s donations to the Effective Ventures Foundations. Stating it was a “serious incident,” the Commission added the money could cause additional knock-on effects to other investments.
In the United States, a White House spokesperson refused to respond to reporters on whether US president Joe Biden would return donations from Bankman-Fried. Associated Press reporter Zeke Miller found the President had received $5.2 million in campaign funds.
Bankman-Fried, former Alameda Research CEO Caroline Ellison, and numerous other executives now face multiple counts of misappropriating funds, fraud, and others. The scandal sparked widespread public outcry and tightened regulations from global governmental watchdogs.
