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U.S. seizes $170 million linked to FTX and Bankman-Fried

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The Division of Justice mentioned Friday it has seized $170 million in money with hyperlinks to FTX as a part of the legal case into disgraced cryptocurrency government Sam Bankman-Fried.

Damian Williams, the U.S. Lawyer for the Southern District of New York, mentioned in a courtroom submitting Friday that the cash has been taken over the previous a number of weeks from accounts in a worldwide brokerage agency, a crypto financial institution and a tiny Washington state-based financial institution that has ties to FTX’s management. All of it was in U.S. {dollars}, not cryptocurrency, and is being held by the federal government because the legal case in opposition to Bankman-Fried proceeds.

The accounts have been held both by an organization referred to as Emergent Constancy Applied sciences, which is majority-owned by Bankman-Fried, or FTX Digital Markets, a Bahamian subsidiary of FTX.

A spokesman for the Southern District of New York and Bankman-Fried didn’t return a request for remark.

After greater than three years as one of many world’s best-known cryptocurrency corporations, FTX declared bankruptcy in November amid a spectacular collapse of its change and companion forex. The following month the Justice Division charged Bankman-Fried with eight counts of fraud, cash laundering and different crimes. Bankman-Fried has pleaded not responsible and stays below home arrest at his dad and mom’ house in Palo Alto, Calif.

The Southern District additionally mentioned it has taken about 55 million shares of the buying and selling platform Robinhood — value abut $525 million as of Friday afternoon — which it had beforehand said it would do.

These shares are in dispute, with the Justice Division, Bankman-Fried and defunct crypto lender BlockFi all laying claim to it.

Whereas Bankman-Fried’s earlier private entry to the funds is just not clear, the sums might contradict Bankman-Fried’s statements in interviews in November that he was right down to $100,000 in belongings.

As well as, Williams mentioned the federal government might seize the holdings in three FTX-linked Binance accounts whose worth was not disclosed.

It stays attainable that a few of the cash might be relinquished to the defendant to pay authorized charges. Bankman-Fried’s legal professionals have mentioned he wants the proceeds from the Robinhood shares to just do that.

In the meantime the corporate’s restructuring management is making an attempt to trace down FTX belongings as a part of chapter proceedings. New FTX chief government John J. Ray, with the assistance of New York legislation agency Sullivan & Cromwell, recently said about $5.5 billion out of a lacking $8 billion in belongings have been positioned.

On Friday, the choose presiding within the case, John Dorsey, rejected a bid by two FTX collectors to take away the legislation agency, which has been searching for to proceed in its lead investigative position. Sullivan & Cromwell had disclosed final month that it had earned almost $9 million working for Bankman-Fried’s firm, and that it as soon as employed FTX U.S. normal counsel Ryne Miller, prompting considerations of a battle of curiosity within the creditor motion.

However Dorsey mentioned at a listening to he didn’t see any motive to grant the collectors’ request.

“There’s no proof of any precise battle,” the choose mentioned.

Shayna Jacobs contributed to this report.



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