Several Minnesota politicians received campaign donations from leaders of the sprawling FTX empire prior to the recent crash of the cryptocurrency exchange.
The money given to local campaigns was only a small part of the nationwide spending ahead of the midterms of then-FTX CEO Sam Bankman-Fried and FTX Digital Markets co-CEO Ryan Salame. While Bankman-Fried’s spending in Minnesota went to the Democrats, Salameh’s dollars went to the Republicans.
In Minnesota’s primary swing district, which includes suburbs south of the Twin Cities, Democratic Rep. Angie Craig’s campaign received two donations from Bankman-Freed, according to federal campaign finance records.
“My campaign received and spent $5,800 in campaign contributions from Sam Bankman-Fried during our last election,” Craig, who defeated Republican Tyler Kistner to win a third term, said in a statement. “The crypto space has remained largely unregulated, and the lack of oversight comes with significant risks. Congress needs to do more to regulate this industry and better protect consumers.”
A spokeswoman for Craig’s campaign said earlier this week that she has no plans to donate money from Bankman-Fried. Craig serves on the House Agriculture Committee and the Energy and Commerce Committee.
US Senator Tina Smith’s campaign also received $5,800 from Bankman-Fried, although she was not re-elected and her seat won’t be on the ballot until 2026. In the statement, Smith said she would donate the dues to the non-profit organization. . Smith serves on the Agriculture Committee and on the Senate Banking Committee.
“I have serious concerns about cryptocurrencies and the financial risks it poses to retail investors, which is only underscored by what happened on FTX,” Smith said. “Obviously we need to think carefully about how cryptocurrency is regulated and how we can best protect consumers and the economy.”
The Associated Press reported that FTX and Bankman-Fried are under investigation by the Securities and Exchange Commission and the US Department of Justice.
OpenSecrets, a non-profit organization dedicated to money in politics, said Bankman-Fried, Salameh and FTX CTO Nishad Singh have collectively donated about $70 million this election cycle.
Although Bankman-Fried spent heavily on Democrats, some of the money went to Republicans, according to OpenSecrets. The Republican Party narrowly regained control of the US House of Representatives in the midterm elections, while the Democrats held on to the US Senate.
According to federal campaign finance records, Bankman-Fried’s major spending included $6 million for a Democratic-leaning PAC majority in the House of Representatives at some point earlier this year and $250,000 for the Congressional Democratic Committee on Campaign. The Minnesota DFL Party received several hundred dollars from Bankman-Fried in 2020 and almost $10,000 this August. A party spokesman declined to comment.
According to OpenSecrets and campaign finance data, Salameh has been a major contributor to the Republican Party. Among his major donations was $2 million to the Republican-focused Congressional Leadership Fund.
Together, Bankman-Fried and Salame donated more than $100,000 to the Congressional Republican National Committee (NRCC), a campaign body chaired by Minnesota U.S. Representative Tom Emmer. The NRCC declined to comment, and the Emmer campaign did not respond to a request for comment on several thousand dollars received from Salameh.
Emmer, who is expected to have a strong impact next year as a third-seat Republican in the House of Representatives, is a strong supporter of cryptocurrencies. In March, he was one of eight members of Congress who signed a bipartisan letter to the Securities and Exchange Commission questioning their requests for information regarding cryptocurrency and blockchain companies.
Emmer said in tweet thread about the letter in which his office “received numerous tips from crypto and blockchain companies that the information from SEC Chairman @Gary Gensler reporting ‘requests’ to the crypto community is burdensome, doesn’t seem particularly… voluntary… and stifles innovation.”
During a recent appearance on Fox BusinessEmmer, who sits on the House Financial Services Committee, called the collapse of FTX “a failure of centralized finance and a failure of Sam Bankman-Fried.”
Federal campaign records also show Salameh’s American Dream Federal Action political committee spent more than $1 million in outside independent spending supporting Republican Rep. Brad Finstad in his first May special preselection for a seat in Southern Minnesota’s First Congressional District. .
Finstad won a close contest that also had other outside spending centered on either his run or that of state GOP member Jeremy Munson. Finstad later won a snap general election for the seat and prevailed in his bid for a full term earlier that month. In September, Salame donated $2,900 to the campaign for Finstad, a member of the House Agricultural Committee.
“We exercise due diligence when the campaign receives any donation to make sure it meets FEC guidelines,” Finstad campaign spokesman David FitzSimmons said in an email. “Given the current news, the donation in question has been returned. As far as self-sustained spending, campaigning legally has nothing to do with any self-sustaining spending.”
David Schultz, professor of political science at Hamline University, said the scale of donations and the fight to get them back are at the core of how money is raised and spent on political campaigns in the US. According to him, in relation to cryptocurrency in some jurisdictions, questions about ill-gotten gains and money laundering have already been raised.
“There are enough red flags,” Schultz said. “The candidates should have been warned about these problems, but they did nothing. They just jumped on the bandwagon.”
The Associated Press contributed to this report.