According to various reports on Jan. 4, US authorities will take control of Robinhood shares that are being contested by FTX-related parties.
These reports indicate that the U.S. Department of Justice (DOJ) has seized or is currently seizing Robinhood shares related to FTX.
At the hearing, DOJ attorneys said the assets are not part of FTX’s bankruptcy estate and therefore do not need to be frozen like other FTX assets. The attorney also said other assets had been seized and that both Robinhood’s shares and other assets could be further controlled in the forfeiture proceedings.
Several parties claim they have rights to Robinhood shares. Former FTX CEO Sam Bankman-Fried, private investor Yonatan Ben Shimon, lending firm BlockFi, and FTX itself have all attempted to claim rights to the disputed assets.
FTX and Alameda recently requested that their shares be frozen in bankruptcy proceedings, while BlockFi requested that their shares be moved to a neutral account. Statements from today’s hearing show that the shares are being seized in connection with the criminal proceedings against Bankman-Fried and not at FTX’s request.
The disputed Robinhood stake was purchased by his holding company, Emergent Fidelity Technologies, on Bankman-Fried’s behalf last May.
Emergent purchased its 56.2 million shares for $648.3 million. The shares were worth $482 million to him shortly after the purchase. They are currently worth only $465 million.
