FTX asks Stabenow to return donations
FTX specifically mentions Stabenow’s strategy of donating the funds. Charities receiving donations could be targeted for recovery.
FTX, the bankrupt cryptocurrency exchange, has asked various people and organizations to return money its officials had donated to politicians, Axios reported Sunday.
The “ask” reads more like a demand, and it raises the prospect of legal action.
In a press release blasted out far and wide, FTX says it is “sending confidential messages to political figures, political action funds, and other recipients of contributions or other payments,” asking them to return those funds by Feb. 28, 2023.
FTX, under new management due to bankruptcy, is trying to recover funds to pay its debts.
The FTX press release continues:
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.
Recipients are cautioned that making a payment or donation to a third party (including a charity) in the amount of any payment received from a FTX Contributor does not prevent the FTX Debtors from seeking recovery from the recipient or any subsequent transferee.
Michigan Sen. Debbie Stabenow received some $55,600 in donations from four FTX officials. Then-CEO Samuel Bankman-Fried donated $26,600, while Mark Wetjen, Ryne Miller and Zachary Dexter donated $5,800 each.
- Related reading: Stabenow took nearly $56K of donations from FTX, then took lead role on crypto bill
The donations all took place between January and May 2022. Then in August, Stabenow introduced the Digital Commodities Consumer Protection Act. Critics called it the “SBF bill,” saying he had influenced its crafting. They argued the bill would centralize decentralized finance, killing off the concept.
After Michigan Capitol Confidential reported the FTX contributions to Stabenow, The Detroit News reported that Stabenow would give the funds to a local charity.
CapCon argued that the money was not Stabenow’s to donate, saying it should be set aside to make restitution to FTX’s victims.
FTX’s debtors apparently agree, warning politicians that “making a payment or donation to a third party (including a charity) in the amount of any payment received from a FTX contributor does not prevent the FTX debtors from seeking recovery from the recipient or any subsequent transferee.”
Stabenow’s crpyto bill stalled after the FTX bankruptcy proceedings started and Bankman-Fried’s legal troubles, which are ongoing, emerged.
In the 118th Congress, Stabenow has yet to reintroduce the Digital Commodities Consumer Protection Act, or to introduce any legislation. She has announced she will not run for reelection in 2024 and will retire after four terms in office.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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