Ryan Salame, the former second Chief Executive Officer (CEO) of the embattled cryptocurrency exchange FTX is currently facing scrutiny for his connection with Sam Bankman-Fried. Just when it felt like the investigation into the defunct digital asset service provider was coming to an end, Salame’s $4 million Potomac home was ransacked on Thursday by the Federal Bureau of Investigation (FBI).
Markedly, before the implosion of the Bahamian-headquartered crypto exchange in 2022. Salame was recognized as one of the prolific donors of the Republican party according to people familiar with the matter. Apart from being a top executive of the FTX exchange and running the Bahamas subsidiary, Salame was also one of Bankman-Fried’s advisers.
The agency decided to go after Salame as part of the strategy to recover the funds which were donated to political parties from FTX. He allegedly donated as much as $24 million to political parties as campaign contributions in last year’s mid-term elections. Altogether, the federal authorities have arrived at over $90 million as the value of funds contributed to both Republican and Democrat political campaigns by people related to FTX.
However, the authorities discovered that a significant percentage of these funds were misappropriated from customers’ deposits, as the old saying goes Not Your Keys, Not Your Cryptocurrencies.
So far, FTX Group under the leadership of John Ray III has been trying to recover these donations made by SBF and other executives from the beneficiaries.
The firm initially set February 28th as the deadline for all donations to be returned but it doesn’t seem like they have had any luck with that.
FTX Employees Incriminated in Exchange’s Crash
Since the beginning of the FTX liquidity crunch and bankruptcy proceedings, many FTX employees and former executives have been dragged to court.
Caroline Ellison and Gary Wang pleaded guilty to aiding the former CEO in committing fraud in the defunct FTX exchange. Before the unfortunate crash of the exchange, Caroline Ellison was the CEO of Alameda Research LLC, a sister trading firm of the defunct FTX exchange while Gary Wang served as FTX’s Chief Technology Officer.
On the other hand, SBF who lost his position as CEO of FTX has maintained the stance that he is not guilty of all eight charges including misappropriation of customers’ funds, alleged money laundering charge, and breaking US campaign laws levied against him. His trial is still set for later this year in October.
