Crypto billionaire’s PAC spends nearly $1 million in Illinois Democratic congressional primaries

WASHINGTON — Protect Our Future, a political action committee bankrolled by cryptocurrency billionaire Samuel Bankman-Fried, spent $914,944 to boost three Illinois Democratic primary candidates, including $500,065 for television ads to support Jonathan Jackson’s 1st Congressional District bid, according to Federal Election Commission records.

Protect Our Future spending is what the FEC calls an “independent expenditure,” with the PAC by law prohibited from coordinating or communicating with a candidate’s campaign.

A Sun-Times examination of this political spending found:

• The Protect Our Future’s cash play comes as Jackson took an interest in the federal-regulated digital asset industry. He is closely connected to the chair of the House Financial Services Committee, Rep. Maxine Waters, D-Calif.
• Bankman-Fried is the main donor to Protect Our Future. He seems to have flouted federal rules about independent expenditure efforts having no contacts with campaigns they are trying to help.

The PAC spent $151,420 for direct mail pieces to support Rep. Jesus “Chuy” Garcia, D-Ill., even though he is running unopposed in the Democratic primary — and the little known Republican on the ballot in the safe Democratic district is not raising or spending money. That a PAC jumps in a race where a candidate has, for practical purposes, zero real opposition is highly unusual.

Garcia told the Chicago Sun-Times on Sunday that Bankman-Fried phoned him about a week-and-a-half ago to discuss one of his issues, pandemic preparedness. Garcia is a member of the Financial Services Committee, which regulates parts of the digital assets industry.

• Jackson also has not, as of Sunday, filed a required personal finance disclosure, so voters have no idea about Jackson’s income sources.
• Ironically, as Jackson’s candidacy is getting a billionaire’s boost, Sen. Bernie Sanders — who is endorsing Jackson — deplored the power of billionaires at a Saturday rally at the Humboldt Park Boathouse on the Northwest Side. Sanders was on a stage with Jackson and Garcia, who he is close to, and state Rep. Delia Ramirez, D-Chicago, who Sanders is also backing.

“These billionaires don’t want people like Delia and Jonathan to be in Washington,” Sanders said. “They don’t want them. We do want them. They got the money. We got the people power. We can beat the money only if we are organized and we are working hard to bring out the vote.”

The 1st District primary is to replace retiring Rep. Bobby Rush, D-Ill., and the rarely open seat has 17 Democrats on the ballot. The winner of the June 28 primary in this heavily Democratic district will likely clinch the seat in November.

According to television ad-buy tracking data shared with the Sun-Times, the Protect Our Future spots for Jackson are running on cable channels now through Election Day.

The Protect Our Future PAC also spent $263,453 on ads to support Nikki Budzinski, the frontrunner in the 13th District Democratic primary, which snakes through Democratic portions of downstate Illinois — Decatur, Champaign-Urbana, Springfield and East St. Louis.

The purpose of the PAC, a spokesman said, is to encourage pandemic prevention. Michael Sadowsky, the president of Protect Our Future, said in a statement to the Sun-Times the PAC “is proud” to support Jackson, Garcia and Budzinski “because all three will be champions for pandemic prevention once elected to Congress.”

Calls to Jackson for comment have not yet been returned.

THE BANKMAN-FRIED FILE: Bankman-Fried is the founder and CEO of FTX, an international cryptocurrency exchange based in Nassau, the capital of the Bahamas.

The FTX United States operation — FTX US — is headquartered in Chicago’s West Loop.

Bankman-Fried has emerged as one of the leading mega donors of the 2022 cycle, according to Open Secrets, the campaign watchdog group. Open Secrets reported on June 6 that FTX, “helmed by billionaire investor Sam Bankman-Fried, has positioned itself as a leader in the influence battle.”

BANKMAN-FRIED GAVE $23 MILLION TO HIS SUPER PAC: The $500,065 to boost Jackson is from Protect Our Future, a new political action committee that can take unlimited contributions from individuals. FEC records show the PAC reported $24,156,970 in receipts, of which $23 million came from Bankman-Fried, whose address is listed in Nassau. Another FTX executive, Nishad Singh, also with a Nassau address, gave $1 million.

Forbes set Bankman-Fried’s net worth at $19.8 billion.

BANKMAN-FRIED AGENDAS — CRYPTO REGULATION, PANDEMIC: The crypto industry, which is federally regulated, is experiencing enormous growth and is the subject of ongoing congressional scrutiny. In past months, Bankman-Fried has testified before House and Senate committees considering digital asset regulations. Bankman-Fried was a witness before the House Financial Services committee Dec. 8, 2021, hearing titled, “Digital Assets and the Future of Finance.”

Bankman-Fried is also a donor to a nonprofit group, Guarding Against Pandemics, run by his brother, Gabe Bankman-Fried.

DIGITAL ASSET REGULATION TOP ISSUE ON JACKSON WEBSITE: Of all the issues of concern in the 1st Congressional District, which sweeps in parts of the South and Southwest Sides, extending to near Kankakee — digital asset industry regulation has surfaced as a Jackson priority.

That is the first issue on Jackson’s website, where he calls for more minority participation in the crypto business. Jackson even goes so far as to endorse the regulatory framework in a specific bill — the “Digital Commodity Exchange Act.”

The second most prominent issue on Jackson’s site is one titled “pandemic preparedness.”

JACKSON, GARCIA HAVE SIMILAR PANDEMIC PREPAREDNESS LANGUAGE ON WEBSITES: Jackson and Garcia have pandemic readiness statements on their websites that share some unusual language — each calling for “independent oversight of labs conducting dual-use research of concern.” Both endorsed a very specific thing — taking some supervision power away from the National Institutes of Health.

Budzinski has nothing on her website about crypto or pandemic policy. Bankman-Fried also donated $6 million to the Democratic allied House Majority PAC. Winning Illinois 13 is a priority for House Democrats, and Budzinski is seen as the strongest contender in her primary.

JACKSON LINK TO FINANCIAL SERVICES PANEL: The Financial Services Committee is chaired by Waters, who is very close to the Jackson family, led by Rev. Jesse Jackson. As I reported in February, Jackson, at his campaign kickoff, talked about Waters, who has known Jonathan and his disgraced brother, ex-Rep. Jesse Jackson, D-Ill., since they were kids. Former Rep. Jackson resigned his seat under an investigative cloud and went to prison for looting his campaign fund.

GARCIA TALKED TO BANKMAN-FRIED: Garcia noted when we talked Sunday that a candidate has no “choice” over independent expenditures. When I asked Garcia why the cryptocurrency billionaire backed him, he said, “Because I have been outspoken on the pandemic” and about how it impacted Latino and minority communities “disproportionately. And I’ve also been very vocal in the Financial Services Committee about the need for the U.S. to — through it’s representatives in international financial institutions — to provide vaccines for the whole world.”

Garcia, referring to Bankman-Fried, said, “I spoke with the guy. He told me that he appreciated my support for that policy position, here, domestically and aboard.” He called “about a week and an half ago or so.”

ON BANKMAN-FRIED PAC SUPPORTING NIKKI BUDZINSKI: In an open seat contest, Budzinski, from Springfield, is the frontrunner in the Democratic primary for the 13th District. The race is a priority for House Democrats, and the 13th may be competitive in November.

In April, Bankman-Fried contributed $6 million to the Democratic-allied House Majority PAC, whose goal is to keep the House in Democratic control.

Bankman-Fried also gave a personal donation of $2,900 to Ald. Gil Villegas (36th), in a primary where his main rival is Ramirez. Villegas on his website calls for a “new regulatory framework” for cryptocurrency and blockchain technology.

JACKSON LOW ON CAMPAIGN CASH:The $500,065 outside spending for Jackson is about as much or more than the leading separate campaigns have raised. Jackson lags behind his chief rivals in fundraising. Jackson loaned his campaign $50,000 in May.

The Protect Our Future ad buy is pretty major, given the cash-on-hand of the top five rivals according to pre-primary reports filed with the FEC last week, covering contributions and expenditures through June 8.

Jonathan Swain, $543,198 raised with $154,892 cash-on-hand.

Pat Dowell $531,811 raised with $248,184 cash-on-hand.

 Karin Norington-Reaves $459,826 raised with $187,454 cash-on-hand.

 Jonathan Jackson, $375,303 raised with $49,089 cash-on-hand

Jacqueline Collins, $160,936 raised with $56,209 cash-on-hand.