Flanked by security guards clearing a path through paparazzi and news photographers, Sam Bankman-Fried stepped out of a black Suburban and into a Manhattan courthouse on Tuesday afternoon with a backpack over his shoulders and what looked like a wad of gum in his mouth. The 30-year-old former billionaire flew there to plead not guilty at his arraignment on eight criminal counts. The trial itself is not scheduled to begin until October, nearly a year after FTX, his cryptocurrency exchange, collapsed in what prosecutors have called “one of the biggest financial frauds in American history.” But it’s what prosecutors may dig up over the next nine months that has official Washington on tenterhooks.
Bankman-Fried, after all, was until two months ago a bona fide obsession in Democratic politics, one of the biggest donors in the country, with designs to spend as much as $1 billion in 2024. He built a personal philanthropic fiefdom that tried to whip Washington, from pressing the White House on pandemic preparedness to lobbying Capitol Hill on crypto regulation.
Now, following his indictment on murky campaign-finance violations, Democrats who once eagerly solicited money from S.B.F. are preparing for the worst. The watchword of the moment, as one Democratic operative told me, is document retention. “Everyone is worried about legal action,” this person said. “Everyone’s afraid. I think once the charges were announced, and they specifically talked about his campaign donations, that put everybody on a different level than they were when they were just watching his interviews… It turned from a spectator sport into an actual criminal proceeding.”