• The US Department of Justice (DOJ) seized $470 million in Robinhood shares from FTX executives, Sam Bankman-Fried and Gary Wang.
• The DOJ took the action in response to charges of wide-ranging fraud against Bankman-Fried and FTX.
• The seized Robinhood shares are now held by the DOJ until a resolution is reached in the case.
The US Department of Justice (DOJ) recently took action against Sam Bankman-Fried and Gary Wang, two executives at FTX, by seizing $470 million in Robinhood shares. The action is in response to charges of wide-ranging fraud against Bankman-Fried and FTX, with which the equity investments may be involved.
The court document, filed in a New Jersey bankruptcy court, revealed that the DOJ had seized 55,273,469 shares of Robinhood, alongside another $20,746,713.67 from ED&F Man Capital Markets – a holding company controlled by Bankman-Fried. The shares are now held by the DOJ until a resolution is reached in the case.
The seizure of the Robinhood shares was not unexpected, as Bankman-Fried and Wang had previously objected to the DOJ’s request to take possession of the shares. Despite their objection, the court sided with the DOJ, ruling that the shares were “subject to forfeiture” due to the fraud charges.
The charges against Bankman-Fried and FTX are not limited to just the Robinhood shares. The DOJ is also alleging that Bankman-Fried and FTX are involved in a wide range of fraud, including money laundering and securities fraud. Bankman-Fried and FTX have denied all of the allegations, and the case is ongoing.
The seizure of the Robinhood shares has had a huge effect on the two executives. Bankman-Fried and Wang have lost the majority of their equity in the company, and the DOJ is now the majority shareholder. This could have a major impact on the company’s future, and the case is likely to be closely watched by investors.
It remains to be seen how the case will be resolved, and what the ultimate outcome will be. In the meantime, Bankman-Fried and Wang are left with the uncertainty of not knowing when or if they will ever get their Robinhood shares back.