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Former FTX Executive Pleads Guilty in FEC Fraud

Ryan Salame, former co-CEO of FTX Digital Markets, has admitted to participating in fraud against the Federal Election Commission (FEC) and orchestrating an illicit money transmission business. This confession was revealed in a courtroom at the Southern District of New York, adding Salame to a growing list of FTX associates facing serious legal troubles.

I made $10 million in political contributions and called them loans, which I never intended to repay. This practice was supported by Sam Bankman-Fried. I knew it was prohibited.

Ryan Salame

The web of financial intrigue

Salame’s wrongdoing extended to financially supporting his girlfriend Michelle Bond’s 2022 congressional campaign. The scheme involved Salame funneling not one, but multiple $2,900 donations for both the primary and general elections. His deceptive practices further escalated with the illegal funneling of corporate funds into the campaign, openly flouting established legal limits.

Confession and cooperation

Taking responsibility for his actions, Salame revealed that the contributions, amounting to an astronomical $10 million, were never intended to be repayable loans, a plan seemingly supported by Sam Bankman-Fried. During his tenure as head of regulation at Alameda, Salame admitted to leveraging banking connections, although he claims ignorance of the need for a license.

Pending penalties and future judgment

While Salame prepares for a potentially lengthy incarceration, the immediate repercussions have been financially severe.

As part of the agreement reached with the government, Ryan Salame has been ordered to forfeit over $1.5 billion. He has agreed to forfeit $6 million prior to his sentencing, expected in March of next year.

To settle this sum, he has committed to surrendering two valuable Massachusetts properties and a luxury car (Porsche), while also reconciling with a hefty $11 million fine in penalties and restitution ($5 million earmarked for FTX victims). His fate now hangs in the balance, with the sentence scheduled for March 6, 2024, closely followed by the trial of Sam Bankman-Fried, who has maintained a plea of not guilty in this evolving case.

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