Senator Kennedy Presses SEC Nominee on FTX Parents' Alleged Benefits

During a Senate Banking Committee hearing on March 27, 2025, Louisiana Republican Senator John Kennedy questioned SEC Chairman nominee Paul Atkins about the potential investigation into the parents of disgraced FTX founder Sam Bankman-Fried. Kennedy's line of questioning focused on the alleged benefits received by Barbara Fried and Joseph Bankman, both Stanford Law School professors, from their son's now-bankrupt crypto exchange.

Kennedy expressed frustration with the SEC's perceived inaction, stating, “Every time you come to this committee, I’m going to pounce on you like a ninja to find out what the SEC has done. Because I don’t think the SEC’s done a damn thing.” The senator highlighted that the couple allegedly received a $16.4 million mansion in the Bahamas, $10 million in cash, and another $10 million donation to Fried’s “Mind the Gap” political organization. Additionally, an alleged $5.5 million was donated to Stanford University, where both parents taught.

Atkins responded cautiously to Kennedy’s questioning, expressing concern about the reports but not committing to specific actions. He explained that he was not at the Commission during the FTX crisis in late 2022 and agreed to review the SEC’s work on investigating the involvement of Bankman-Fried’s parents when he takes office.

Kennedy also referenced reports that Bankman-Fried’s parents were seeking a presidential pardon for their son. These pardon reports emerged in January 2025, following President Trump’s pardon of Silk Road founder Ross Ulbricht. According to William Livolsi, head of the White Collar Support Group, an SBF pardon seems unlikely due to the direct financial harm involved in the FTX case.

Bankman-Fried’s parents filed a motion to dismiss the FTX complaint on January 15, 2024, claiming they were not FTX officers, were not employed by the exchange, and did not aid anyone in defrauding company clients. The lawsuit against Bankman-Fried’s parents was dismissed without prejudice last month, meaning the case can be reintroduced in the future.

Recent developments in the SBF case include an unsanctioned prison interview with Tucker Carlson in March 2025. Following this interview, Bankman-Fried was placed in solitary confinement and transferred from a New York facility to one in Oklahoma. During the Carlson interview, Bankman-Fried claimed he had given money to Republican candidates “as much as Democrats” and hinted at becoming more conservative in recent years.

Kennedy’s line of questioning also touched on Stanford University’s role in the situation. He pressed Atkins about whether the SEC had investigated the $5.5 million donation to Stanford. In 2023, the university announced it would return these funds. The hearing reflected broader conservative skepticism of elite universities, with Kennedy emphasizing his belief that “there should not be two standards of law and punishment for people in America.”

While Kennedy was the only senator to question Atkins specifically about the FTX crisis, the hearing generally broke along party lines. Republicans appeared pleased with Atkins, viewing him as more reasonable than his predecessor Gary Gensler. Democrats raised concerns about Atkins’ role as an SEC commissioner before the 2008 financial crisis and potential conflicts of interest arising from his position as CEO of Potomak Global Partners, a regulatory compliance consultancy with clients overseen by the SEC.

Atkins has committed to divesting from his stake in Potomak within three months of his confirmation. The Senate Banking Committee is expected to approve his nomination, after which a full Senate confirmation vote will follow. As the confirmation process moves forward, Senator Kennedy has made it clear he intends to hold Atkins accountable for investigating the Bankman-Fried family’s connections to the FTX collapse.