Will Biden Return Sam Bankman-Fried's Money? Jean-Pierre: 'I Am Covered Here by the Hatch Act' (December 13, 2022)

After FTX founder Sam Bankman-Fried was arrested in the Bahamas, a reporter asked the White House a simple question: Would President Joe Biden give back the money?

“The President received campaign donations — campaign donations from him — and many prominent Democrats did, some Republicans did as well. Will the President return that donation?” the reporter asked [1].

Press secretary Karine Jean-Pierre would not say. “So, look, I am covered here by the Hatch Act. I’m limited on what I can say. And anything that’s connected to political contributions from here, I would have to refer you to the DNC,” she said [1].

The video above shows the exchange from the Dec. 13, 2022, White House briefing. Quotes are from the official transcript published by the American Presidency Project [1].

The Fall of FTX

Bankman-Fried had been a star. His rise “included a Super Bowl advertisement and celebrity endorsements from stars like quarterback Tom Brady, basketball star Stephen Curry and comedian Larry David,” the Associated Press later reported [2].

Then his businesses collapsed in November 2022, “leaving customers, investors and lenders short over $11 billion,” the AP reported [2].

”Customer Money”

The reporter’s question went further than Biden’s own campaign. “Does he call on all politicians who got campaign donations that may have come from customer money to return those funds?” [1]

The reporter pressed for Biden’s view: “I mean, I’m asking the President’s opinion, though.” Jean-Pierre split the question in two. “No, you asked me two questions. You asked me about will he return the donations, and then you asked me about his opinion,” she said. “I’m covered by the Hatch Act from here. I am limited on what I can say. And I just can’t talk to political contributions or anything related to that” [1].

”Even His Opinion”

The reporter tried once more. Jean-Pierre held the line. “I — I just — just cannot speak to this from here. Even his opinion, even his thoughts about the contributions, donations, I cannot speak from it — from — about that from here,” she said [1].

Another reporter asked: “Are you covered by the Hatch Act?” [1]

“I am covered by the Hatch Act, which I’m happy to say over and over again, because we believe in the rule of law here,” Jean-Pierre answered [1].

”Something for Congress to Do”

Later in the briefing, a reporter asked what the administration could do about the crypto collapse. “Karine, aside from the arrest of Sam Bankman-Fried, what actions can you take to protect people from the collapse of the crypto market?” [1]

Jean-Pierre pointed to Capitol Hill. “This administration has consistently urged Congress to take action to address regulatory gaps posed by digital assets,” she said, citing Treasury Secretary Janet Yellen. “But, again, we have urged — this is something for Congress to do” [1].

By the Numbers

25 years: Bankman-Fried’s prison sentence [2].
$11 billion: what the judge ordered him to forfeit [2].
$8 billion: what customers lost, according to the judge [2].
40 to 50 years: the sentence prosecutors sought [2].
105 years: the sentence the court’s probation officers recommended [2].

What Happened Next

Bankman-Fried was convicted and sent to prison. A jury convicted him in November 2023 of fraud and conspiracy. On March 28, 2024, U.S. District Judge Lewis A. Kaplan sentenced him to 25 years in prison, the Associated Press reported [2].

Prosecutors had laid out the case in a court filing. “He stole money from customers who entrusted it to him; he lied to investors; he sent fabricated documents to lenders; he pumped millions of dollars in illegal donations into our political system; and he bribed foreign officials,” they wrote [2].

Kaplan said Bankman-Fried had “repeatedly committed perjury” on the witness stand, the AP reported. “There is absolutely no doubt that Mr. Bankman-Fried’s name right now is pretty much mud around the world,” the judge said. He said the sentence reflected “that there is a risk that this man will be in position to do something very bad in the future. And it’s not a trivial risk at all” [2].

Bankman-Fried apologized in court. “A lot of people feel really let down. And they were very let down. And I’m sorry about that. I’m sorry about what happened at every stage,” he said [2].

Jean-Pierre was found to have broken the Hatch Act herself. Six months after the briefing, the Office of Special Counsel, which enforces the law, said Jean-Pierre had violated it before the 2022 midterms with her frequent references to “MAGA Republicans.” She “made those references to generate opposition to Republican candidates,” the office wrote, according to the AP [3].

The AP noted the irony. “Since taking on the role of White House press secretary, Karine Jean-Pierre has become known for frequently dodging questions by citing the Hatch Act,” it reported. The finding came after “a conservative organization called Protect the Public’s Trust filed a complaint” [3].

Jean-Pierre said she had been cleared to use the phrase. “At the time, I was given the sign off to use that terminology,” she said [3].

“MAGA remains the campaign slogan of a current candidate for partisan political office, and therefore, its use constitutes political activity,” the office said in a memo reported by Fox News [4].

For how Jean-Pierre answered for the finding, see HYGO News’ page on the Hatch Act ruling.