DOJ Seizes More Than $456,000,000 Worth of Robinhood Shares Connected to FTX Founder Sam Bankman-Fried

The U.S. Department of Justice (DOJ) has formally seized Sam Bankman-Fried’s in the popular trading app Robinhood, despite protests from Bankman-legal Fried’s team.

In a petition dated January 6th, prosecutors with the Commercial Litigation department of the DOJ Civil Division warn the bankruptcy court in the district of New Jersey that the US government is now in possession of Robinhood shares valued at approximately $456 million.

Court-authorized seizure orders filed in the Southern District of New York have resulted in the United States seizing 55,273,469 shares of Robinhood Markets Inc. stock and $20,746,713.67 in U.S. funds from an account at ED&F Man Capital Markets Inc.

According to the complaint, the confiscated assets include breaches of money laundering and wire fraud legislation and are not part of the bankruptcy estate.

In November, FTX filed for bankruptcy after the cryptocurrency exchange failed to fulfil client withdrawal requests.

The seizure comes as Bankman-Fried faces an eight-count indictment for reportedly misappropriating billions of dollars in FTX client funds.

In an affidavit submitted on the 12th of December with the Eastern Caribbean Supreme Court, Bankman-Fried claims that he and FTX chief technology officer Gary Wang borrowed cash from FTX sister business Alameda Research to finance Emergent Fidelity Technologies, which purchased Robinhood shares. Bankman-Fried owns ninety percent of the shell business.

The attorneys for Bankman-Fried contend that Emergent is not responsible for FTX’s collapse and so should not be included in the bankruptcy proceedings. Additionally, they claim that the former crypto millionaire needs the shares to support his legal defence.

Also Read: Approximately 65 Percent Of USDC Reserves Are Stored In US Treasury Notes