Inside the FTX straw donor machine, where customer funds were funneled into campaign contributions

One purpose is political donations. As prosecutors filed a criminal complaint against Bankman-Fried, they focused on tens of millions of dollars worth of campaign contributions made by FTX and executives to candidates, claiming many of the donations came from straw donor schemes, meaning They were donated illegally in someone else’s name.

On Monday, Singer confirmed the allegations and detailed how Bankman-Fried’s brother, Gabriel, and his associates used Singer’s bank account to make donations. All Singh had to do was confirm an email from his bank, Prime Trust, confirming that the huge amount of money flowing out of his account was not a fraud.

“After a certain point, my role was to click a button,” Singer testified.

generous donor

Bahamian authorities arrested Bankman-Fried in December, weeks after FTX collapsed. He was extradited to the United States, and prosecutors revealed that two of his closest associates, FTX Chief Technology Officer Gary Wang and Alameda Research CEO Caroline Ellison )—had been extradited to the United States. Have cooperated with the government.

In February, Singer also reached an agreement with the Justice Department and pleaded guilty to six crimes, including wire fraud, money laundering and conspiracy to make illegal political contributions.

Singer’s cooperation initially led to a new charge against Bankman-Fried related to illegal campaign contributions, but that charge was later dropped because prosecutors said they intended to incorporate the charges into the broader case against Bankman-Fried, including He allegedly used FTX client funds for everything from luxury real estate to donations.

Before FTX collapsed, Bankman-Fried was one of the most generous donors in the United States, giving tens of millions of dollars from employees to political candidates. An internal Alameda spreadsheet tracked more than $100 million in donations, according to the February indictment.

favorable optics

Singer’s testimony Monday shed new light on Bankman-Fried’s operations. According to Singh, another FTX executive, Ryan Salame, had access to his bank account with Prime Trust. Employees at Gabriel Bankman-Fried’s political organization Pandemic Preparedness would send Salaam messages in Signal’s group chat, asking for donations to specific campaigns. Salam would then wire money from Singer’s account. If the amount exceeds a certain limit, Singer will receive an email confirming the transaction. Salaam has a similar arrangement with Sam Bankman-Fried.

Political consultants hired by Gabriel Bankman-Fried chose to make Singer “the center-left representative of our spending,” according to Signal.

“It was useful to have my name associated with some of the donations, even if the recipient knew the donations came from someone else,” Singer testified.

Singer said in his testimony that he tried to distance himself from the donation process. That included trying to convince the consultant to use his credit card to donate directly to ActBlue, a Democratic platform. When that failed, he created a PayPal account and put it in his name. When that also failed, he authorized an employee to issue blank checks from his Wells Fargo account. The employee then flew the check to Singer’s office in the Bahamas, where he signed the check so they could donate freely.

Singer said that while the funds initially came from his own salary, his bank account was later infused with funds directly from Alameda Research, a trading firm associated with FTX.

Singer said he became aware in September 2022 that Alameda was funded by FTX customer deposits. He continued to receive funds from Alameda and then used the funds for political donations, meaning the funds belonged to FTX clients.

Singer faces up to 75 years in prison, although he testified Monday that he hoped to avoid jail time in exchange for cooperation.