The FTX scam, Sam Bankman-Fried, the Clintons and the Democrats

Congress took millions from FTX. Now lawmakers face a crypto reckoning.
The stunning collapse of the world’s third-largest exchange has forced politicians to grapple with the costs of legislative inaction

https://www.washingtonpost.com/us-policy/2022/11/17/congress-crypto-ftx-regulations-law/

excerpt:

On Capitol Hill, the fiasco quickly captured unexpectedly wide, bipartisan attention.

The shift began Tuesday, as lawmakers sorted out the repercussions of the 2022 elections. At a news conference normally reserved for Democratic leaders to lob political barbs and issue policy announcements, Rep. Hakeem Jeffries (D-N.Y.), the caucus chair, said the party had plenty of priorities in the waning weeks of the year — and “the situation related to the cryptocurrency industry will be one of them.”

The House Financial Services Committee, led by Rep. Maxine Waters (D-Calif.), later announced its plans to hold a hearing on FTX, potentially featuring Bankman-Fried’s testimony. “Unfortunately, this event is just one out of many examples of cryptocurrency platforms that have collapsed just this past year,” lamented Waters, describing an “urgency” to act.

Across the Capitol, the fallout from FTX quickly overshadowed what normally might be a somnambulant hearing in the Senate Banking Committee about credit unions. Sen. Patrick J. Toomey (Pa.), its soon-retiring top Republican, seized on the moment to highlight “several high-profile collapses of crypto companies, including one prominent example last week” — a reference to FTX, if not explicitly by name.

Toomey previously has purchased cryptocurrency assets, his personal financial disclosures show. But he focused his opening statement on the repercussions when a firm like FTX, which was based in the Bahamas, can run roughshod over the U.S. economy.

“As a general matter, the failure of Congress to pass legislation in this space and the failure of regulators to provide clear guidance has created ambiguity that has driven developers and entrepreneurs overseas,” he warned. “And we’ve just once again seen how that ends.”
​

more at the link

 

The lack of regulation is sadly a better result than what SBF was pushing Congress to do. He wanted them to grant the underfunded and toothless CFTC regulatory authority over crypto in exchange for creating some kind of government backstop (like the FDIC and SIPC along with lending facilities for exchanges) for crypto. At least by not regulating it, we aren't handing out bailouts to these crooks and creating conditions for low cost credit that could've greatly extended his crooked scheme.

 

Althouse:

an hour ago
"'SBF,' as he is widely known, visited the White House, attended a congressional retreat, and held countless meetings with lawmakers and top regulators."
by noreply@blogger.com (Ann Althouse)

"He got chummy with Bill Clinton after paying the former president to speak at a conference.... And he earned praise during Senate testimony from Sen. Cory Booker, D-N.J., for a 'much more glorious afro than I once had.' In just two years since Bankman-Fried's first political donation, his money hired dozens of top-flight lobbyists and political operatives, made major investments in newsrooms like ProPublica and Semafor, and made him the second-biggest Democratic donor of the 2022 midterms, behind only the 92-year-old financier George Soros. He said $1 billion would be a 'soft ceiling' for his spending in 2024.... His downfall will leave some Democratic groups with budget holes to fill.... 'A lot of people in D.C. thought this was the next big thing. Everybody was trying to get in,' said one source close to the Bankman-Frieds’ political operation who requested anonymity to speak candidly. 'This went from the hottest thing to the most toxic thing. But that’s how D.C. works.'"

From "Vegan canapes and fat donations: How Sam Bankman-Fried won Washington before he lost everything/The 30-year-old mega-donor was building a massive, multimillion-dollar Washington operation. Then the gravy train crashed" (NBC News).
​

 

I don't think you can trust anything NBC News reports

 

So, we are now all against donations from the rich and powerful? Against Citizens United? Yea didn't think so. Hypocrites as usual.

 

Need regulation, but not toothless and bad regulation.

"**** regulation" - SBF

 

@Os Trigonum enters the chatroom.

 

What's the Clinton link again? Why didn't you mention that this also involved the GOP in your thread title? Were all the regulators Democrats and Democrat appointees? Absolutely not.

Regulators defend their caution on crypto in Senate panel hearing
Some GOP lawmakers blasted a dearth of guidance from the OCC, Fed and FDIC, and one suggested it’s up to Congress to establish the rules.

 

This financial scandal (like the ones before it- 2008, Enron, Savings and Loan, etc) highlights the critical need for more robust financial/campaign finance regulation and monitoring. Which party consistently supports this type of regulation and monitoring? Which party opposes it with rabid ferocity? Unless you engage with this fundamental reality, soap opera twitter threads don't amount to ****.

 

The more I read about this the more my jaw drops. Emailing private keys in the open? I wouldn’t be surprise if a large amount of the customers fund have been stolen months ago.

Everything must be a conspiracy is such a dumb distraction from a massive financial fraud, maybe even bigger than Enron.

 

I am not sure what conspiracy means in this context. I know the word conspiracy keeps popping up, but it's always been about sheer negligence and fraud across the board. This has been what a couple of us have been saying from the beginning. It is an absolute cluster ****.
The more I hear about it the less sympathetic I am towards the institutional investors who got defrauded. There was simply no due diligence.

 

From the thread title, I was expecting more involvement by the Clintons than this (I think I got it all):

• Bill Clinton personally gave the guy credibility by appearing on stage at at least one company event the guy organized (unclear whether/how much/what kind of compensation was provided in exchange - this is something that should be researched)
• The guy's mother was Hillary Clinton's lawyer
• The Head of the SEC was previously in charge of campaign financing for Hillary Clinton
• Hillary Clinton had lobbied for this regulation, which ended up happening, and which ended up benefitting FTX (and thereby indirectly this guy personally, because he used FTX and Alameda money as if it were his own, basically embezzling it)

 

Don’t forget Larry David….. now we can tie in Zionism!!!!!

 

Not a lot of links in this summary….

So you are basically asserting that the Dems were responsible for this?

 

Do you really not understand why including them in a thread title that starts with "The FTX scam, Sam Bankman-Fried," leaves people with the impression that you are implying they are part of the scam? Especially when they've been a frequent target of conspiracy theories and corruption charges for decades?