U.S. drops plan to prosecute convicted SBF for over $100M in unlawful campaign donations

In a filing on Dec. 29, U.S. prosecutors said that they will not be pursuing a second trial for additional charges against former FTX founder Sam Bankman-Fried (SBF). On Nov. 3, SBF was convicted of seven charges of fraud.

SBF was expected to be prosecuted on six additional charges in a separate trial. The charges included unlawful political campaign contributions, while a superseding indictment in March 2023 added charges of conspiracy to bribe foreign officials, conspiracy to commit bank fraud, conspiracy to operate an unlicensed money-transmitting business, as well as substantive securities and commodities fraud.

SBF reportedly donated $119 million to political campaigns. He was the fourth largest donor in the 2022 midterm elections, with donations exceeding $39 million.

According to the filing, the charge for unlawful political contributions was part of the original indictment. However, the unlawful donations charge, along with those brought by the superseding indictment, were included after SBF was extradited to the U.S. from The Bahamas in December 2022.

In July 2023, The Bahamas informed the U.S. that it did not consent to SBF being tried on the additional charges, since they were not part of the extradition treaty. Therefore, to avoid delay, the prosecutors proceeded with SBF’s trial in October with the seven charges included in the extradition treaty.

Limited new evidence

Prosecutors noted that they produced evidence of SBF’s unlawful political donations at the trial as direct evidence of the seven counts of charges against him. The prosecutors also presented evidence, including documents and witness testimony, to prove SBF’s guilt in the remaining five charges, the filing noted.

Therefore, a second trial would have involved presenting much of the same evidence that was presented in the initial trial, the prosecutors noted.

More importantly, prosecutors said that the Court can consider the evidence presented at the initial trial during his sentencing in March 2024. The filing added:

“…a second trial would not affect the United States Sentencing Guidelines range for the defendant.”

This means that the second trial would not have affected the duration of SBF’s sentence.

The need for prompt resolution outweighs the need for a second trial

According to the prosecutors, a second trial would cause unnecessary delays in the resolution of the case. This is because The Bahamas is yet to respond to the U.S.’s request for prosecuting SBF on the additional charges.

Therefore, proceeding with the sentencing would “advance the public’s interest,” which “outweighs” the interest in pursuing a second trial, the prosecutors noted. They added that a prompt resolution is particularly important in this case since the judgment will likely include “orders of forfeiture and restitution for the victims.”

It is uncertain how the prosecution’s decision to drop the unlawful donations charge will affect FTX’s efforts to recoup the contributions.

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