Federal prosecutors have confiscated nearly $700 million in cash and assets linked to EX FTX CEO Sam Bankman-Fried.
A recent court filing revealed that the federal authorities confiscated more than 55 million shares of Robinhood stock along with millions of dollars from free accounts at Silvergate bank.
The crypto billionaire who was arrested in the Bahamas and extradited to the U.S. is currently facing fraud charges. He has been accused of stealing billions of Dollars from FTX customers to fund his crypto-focused hedge, Alameda research.
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Wall Street Journal reported that Bankman-Fried may have illegally taken about $10 billion in FTX customers’ funds for his trading firm. He is also accused of using investors’ funds to buy real estate as well as making several donations.
Federal prosecutors revealed that he made corporate contributions to candidates and political action committees in New York that were reported in the name of another person.
He was reported to have contributed more than $70 million to election campaigns in less than 18 months, placing him among the nation’s top political donors.
On November 10, Bankman-Fried publicly apologized on Twitter. He wrote, “I fucked up, and should have done better. I also should have been communicating more very recently.” He later pointed to a poor internal labeling of bank-related accounts as one reason why FTX didn’t have the liquidity to return money to clients.
1) I'm sorry. That's the biggest thing.
I fucked up, and should have done better.
— SBF (@SBF_FTX) November 10, 2022
Meanwhile, in a recent court hearing, Bankman-Fried has pleaded not guilty to fraud charges, declaring that he didn’t steal customers’ funds, neither did he stash billions away. He revealed that nearly all his assets are utilizable to backstop FTX customers.
During an interview with Bloomberg last year, he claimed to have misaccounted for $8 billion in FTX funds, which he pulled out a spreadsheet, detailing the bad math he used while approaching investors for a potential last-second bailout of FTX and its sister trading firm Alameda research.
Meanwhile, Coinbase CEO Brian Armstrong rejected SBF’s ‘Accounting Error,’ in which he stated that customers’ funds were obviously stolen. He further stated that only the “most gullible person” would believe an $8 billion hole was due to lackluster accounting.
He wrote on Twitter,
I don't care how messy your accounting is (or how rich you are) – you're definitely going to notice if you find an extra $8B to spend.
Even the most gullible person should not believe Sam's claim that this was an accounting error.
— Brian Armstrong ?? (@brian_armstrong) December 3, 2022
“I don’t care how messy your accounting is … you’re definitely going to notice if you find an extra $8B to spend. Even the most gullible person should not believe Sam’s claim that this was an accounting error.”
Meanwhile, the new FTX CEO John Ray, who replaced Bankman-Fried to guide FTX’s restructuring, is trying to rescue funds that were lost by the crypto company’s depositors when the firm spiraled into bankruptcy in November last year.
He further provided some additional details about the FTX’s recovery effort by disclosing that the firm has recovered $1.7 billion in cash, $3.5 billion in liquid cryptocurrency, and $300 million in liquid securities.
John Ray III, while testifying to the U.S house committee, disclosed that U.S. customers are more likely than other customers to get their money back.