The Jan. 6 committee seems to have aimed its work at history, rather than the short-term political cycle. On Monday, it made some of its own, for the first time recommending that a former president be prosecuted on criminal charges.
What do you do if you鈥檙e a politician, and Sam Bankman-Fried 鈥 aka SBF, the indicted cryptocurrency tycoon 鈥 donated to your campaign? Maxwell Frost, soon to be the first Gen Z member of Congress, made a show last week of giving his tainted SBF money to charity.
鈥淚鈥檓 donating his contribution to @ZebraCoalition, which helps serve LGBTQ+ youth,鈥 Representative-elect Frost, Democrat of Florida,聽.
Such a move may feel morally satisfying, but wait: Shouldn鈥檛 that money go back to Mr. Bankman-Fried鈥檚 bankrupt company, FTX, for eventual payment to creditors? That鈥檚 what Beto O鈥橰ourke, the Democrat who ran unsuccessfully for governor of Texas, did with his SBF money. And that actually may be the safer decision, say experts on financial regulation.
鈥淭he bankruptcy estate may come calling,鈥 Yesha Yadav, a law professor at Vanderbilt University,聽.
Dan Weiner, director of the Elections and Government Program at the Brennan Center for Justice, says that what Representative-elect Frost did was fairly common.
鈥淲hen a candidate wants to disassociate from a donor, and for whatever reason, refunding the donation is impractical or undesirable, they鈥檒l give it to a charity,鈥 Mr. Weiner says.
But if a donation is found to have been illegal, 鈥渋t will need to be refunded or disgorged to the U.S. Treasury even if the campaign didn鈥檛 do anything wrong,鈥 Mr. Weiner writes in a follow-up email. 鈥淭hat doesn鈥檛 mean they can鈥檛 make a donation now, but they will have to come up with the money later.鈥
Another option, experts on campaign finance say, is to put money aside in escrow for possible restitution payment to victims.
Mr. Bankman-Fried聽was the second-biggest donor to Democrats in the 2022 cycle, at almost $37 million, according to聽. Another former FTX executive, Ryan Salame, donated $24 million this cycle, mostly to Republicans.
Federal prosecutors are聽聽to campaigns and committees, seeking information about the donations. The journey into the thicket has only begun.