The Federal Government Seizes Assets Worth About 700 Million Dollars of FTX Assets

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Last Updated on January 21, 2023 by Bitfinsider

A court filing disclosed Friday that federal authorities took approximately $700 million in cash and assets related to Sam Bankman-Fried, mostly in the form of Robinhood shares owned by the FTX founder.

John Ray, who took over as CEO of FTX when Bankman-Fried stepped down, is attempting to recoup monies lost by the crypto company’s depositors after it declared bankruptcy in November. Bankman-Fried was arrested in December on criminal fraud allegations and is being held on a $250 million bail while awaiting trial.

The 55 million or so Robinhood shares are at the center of a complicated multi-party struggle including Caribbean plaintiffs, representatives of insolvent crypto lender BlockFi, Bankman-Fried himself, and the bankruptcy leadership of FTX.

According to federal authorities, the Robinhood shares were acquired with allegedly stolen consumer monies. Bankman-Fried stated in May that he had bought a 7.6% interest in Robinhood, saying at the time that “we think it is a good investment.” The stock ended at $9.52 on Friday, putting the recovered shares at more than $526 million.

Bankman-Fried has denied stealing from customers.

Three of the confiscated accounts, totaling more than $6 million, were held at Silvergate Bank in the name of FTX Digital Markets. The government took over the assets, which were held in the name of a Bahamian company, “on or about” January 11. Silvergate has revealed that in the fourth quarter of 2022, consumer deposits fell by approximately 70%.

According to the court petition, about $50 million was held at Moonstone Bank, a U.S. banking institution with links to FTX management.

The worth of monies or assets in one Binance account and two Binance accounts was not disclosed by federal prosecutors.

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