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US Government Seizes $700 Million In Assets From Disgraced FTX Co-Founder Sam Bankman-Fried

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US Government Seizes $700 Million In Assets From Disgraced FTX Co-Founder Sam Bankman-Fried

Federal prosecutors have seized $697 million in assets, mostly comprised of more than 56 million Robinhood shares worth $526 million, from FTX co-founder Sam Bankman-Fried. Court filings detailed that the U.S. government seized a series of bank accounts belonging to Bankman-Fried, holding millions in cash.

US Government Seizes Millions in Cash and Robinhood Shares From FTX Co-Founder; SBF Denies Misappropriation of Customer Assets

The U.S. government has seized nearly $700 million from the former FTX CEO and co-founder, Sam Bankman-Fried (SBF), according to court documents reviewed by CNBC. Most of the funds came from the 56,273,269 shares of Robinhood Markets Inc. (Nasdaq: HOOD) owned by Bankman-Fried. Using exchange rates from Jan. 20, 2023, the Hood shares are worth more than $526 million.

Furthermore, CNBC reporters Rohan Goswami and MacKenzie Sigalos detail that nearly $56 million held in four bank accounts was seized as well. Three accounts holding $6 million were allegedly held at Silvergate Bank and one account reportedly held at Moonstone Bank held $50 million. In total, $171 million in cash was taken by the federal government from Bankman-Fried. Moonstone Bank explained on Jan. 19, 2023, that the financial institution will officially be exiting the crypto space.

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Alameda Research invested $11.5 million into Moonstone Bank, also known as Farmington State Bank, through FBH, Moonstone’s holding company. Federal prosecutors believe the $697 million in assets, mostly made up of Robinhood shares, were acquired using funds stolen from FTX customers. Bankman-Fried maintains his innocence and has “denied misappropriating customer assets,” Sigalos explained on Friday.

Additionally, federal agents also seized funds that belonged to SBF that were held on the crypto exchanges Binance and Binance US. The U.S. government revealed intentions to seize the Robinhood shares during the first week of January 2023, and the U.S. Department of Justice (DOJ) initiated the process.

Bankman-Fried attempted to regain access to the shares, noting that he needed the money to pay for legal expenses. The U.S. government can seize funds from citizens suspected of wrongdoing without necessarily charging them with a crime and from charged suspects awaiting trial. Federal prosecutors do not believe the assets seized are the property in the bankruptcy estate.

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Alameda Research, Assets, bank accounts, Binance, Binance.us, Cash, crypto space, customers funds, DOJ, Farmington State Bank, FBH, ftx, FTX customers, legal expenses, misappropriation, Moonstone Bank, Robinhood shares, Sam Bankman-Fried, Seizure, Silvergate Bank, suspected wrongdoing, U.S. Department of Justice, U.S. Government

What do you think about Federal prosecutors seizing nearly $700 million from SBF? Share your thoughts in the comments section below.

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Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Alameda Research

Voyager Digital creditor requests trustee to seize control of the estate

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Voyager Digital creditor requests trustee to seize control of the estate

  • A Voyager creditor has requested a chapter 11 trustee to partake in the bankruptcy trial of Voyager Digital.
  • Previously, Voyager and its creditors resisted Alameda Research’s attempts to recoup $446 million in loan repayments.

A Voyager creditor and finance lawyer has requested the involvement of a chapter 11 trustee in the bankruptcy trial of crypto brokerage Voyager Digital. This could result in Voyager losing control of its estate.

In a motion issued on 1 February, Voyager creditor Michelle DiVita accused Voyager of a history of financial statement inaccuracies and public misrepresentations that were known, or reasonably discoverable, at the start of the bankruptcy.

DiVita believed that an examiner or trustee should have been requested because of this pre-bankruptcy behavior. Inasmuch, she was requesting one herself.

@investvoyager loans disclosed on March 31 financial report: $2.2B.

Actual loans on April 3: $3.1B

$1.1B concealed in one business day.

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Releases are unconscionable @VoyagerUCC @DOJCrimDiv #VGX pic.twitter.com/dP8g9yvY48

— Michelle DiVita (@ChelleDiVita) January 13, 2023

Voyager has been accused of concealing the true nature of its lending activities by publishing financial reports that materially understated its loan positions by over $1 billion USD.

Shigo Lavine, a former Voyager director, highlighted some of the key allegations in the filing on Twitter on 1 February. Voyager allegedly underreported a $609 million loan to crypto hedge fund Three Arrows Capital. Moreover, it undervalued Bitcoin [BTC] in its financial reports by 546% to downplay the size of its loans.

🚨🚨Pro Se creditor @ChelleDiVita has filed a motion in the @investvoyager Bankruptcy calling for the appointment of a Chapter 11 Trustee. 🚨🚨

This filing is very significant. I’ll be breaking it down here 🧵https://t.co/Y4twn7seT4 pic.twitter.com/Ot1dz7oJPI

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— Shingo Lavine (@shingolavine) February 1, 2023

Coinbase aware of Voyager Digital’s misgivings

Crypto exchange Coinbase also became aware of Voyager’s financial reporting inconsistencies. It reportedly backed out of a potential deal to acquire Voyager’s assets after discovering the financials don’t add up.

Notably, the U.S. Trustee appoints a creditors committee and evaluates applications for professional re-compensation. Additionally, they may also recruit a bankruptcy trustee to oversee the debtor’s affairs if the debtors do not do so themselves.

Recently, Voyager and its creditors resisted an attempt by bankrupt trading firm Alameda Research to recoup $446 million in loan repayments. Alameda had sought to recover the funds in a 30 January court filing. Allegedly, they repaid the loans within 90 days of filing for chapter 11 bankruptcy. Thus, they sought to recoup these funds for the benefit of Alameda creditors.

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Ser Suzuki Shillsalot has 8 years of experience working as a Senior Investigative journalist at The SpamBot Times. He completed a two-hour course in journalism from a popular YouTube video and was one of the few to give it a positive rating. Shillsalot’s writings mainly focus on shilling his favourite cryptos and trolling anyone who disagrees with him. P.S – There is a slight possibility the profile pic is AI-generated. You see, this account is primarily used by our freelancer writers and they wish to remain anonymous. Wait, are they Satoshi? :/

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$1.4 billion

Alameda Research Seeks $446 Million Over Alleged ‘Preferential Transfers’ To Voyager Digital

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Alameda Research Seeks $446 Million Over Alleged ‘Preferential Transfers’ To Voyager Digital

On Monday, Alameda Research Ltd. filed a legal complaint against Voyager Digital LLC and HTC Trading Inc. in the U.S. bankruptcy court. The complaint alleges the defendants received preferential transfers of property from Alameda Research and the plaintiffs are seeking to recover approximately $445.8 million from Voyager and HTC.

Legal Battle Erupts Over Crypto Asset Transfers Reportedly Made by Alameda Research

A newly filed complaint in the FTX bankruptcy proceedings shows Alameda Research, the defunct quantitative trading firm created by Sam Bankman-Fried (SBF), is seeking close to $446 million from bankrupt exchange Voyager Digital and HTC Trading. Lawyers for Alameda claim the company paid off outstanding loans after Voyager filed for bankruptcy protection in July. The complaint also claims the transfers are recoverable as an administrative priority under sections 503 and 507 of the U.S. Bankruptcy Code.

“The collapse of Alameda and its affiliates amid allegations that Alameda was secretly borrowing billions of FTX-exchange assets is widely known,” the filing details. “Largely lost in the (justified) attention paid to the alleged misconduct of Alameda and its now-indicted former leadership has been the role played by Voyager and other cryptocurrency ‘lenders’ who funded Alameda and fueled that alleged misconduct, either knowingly or recklessly,” the complaint adds.

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When Voyager filed for bankruptcy protection in July, it cited a loan default worth hundreds of millions from Three Arrows Capital. After Voyager’s bankruptcy, Sam Bankman-Fried and FTX claimed they could offer early liquidity to Voyager Digital’s customers in the proceedings. Then they detailed plans to purchase Voyager and its assets for $1.4 billion. Soon after, the Texas State Securities Board (TSSB) objected to FTX’s bid, stating the state securities commissioner needed to “determine whether FTX US is complying with the law.”

Alameda’s lawyers say in the filing that after the firm paid Voyager in crypto assets, it “had been unable to determine whether [Voyager] held a valid and effective lien or security interest.” The plaintiffs’ lawyers consider the transfers “preferential transfers” that were “avoidable.” Alameda insists it’s entitled to payment for the transfers, which it says were “made to or for the benefit of one or more of the defendants.”

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$1.4 billion, Alameda Research, approximately $445.8 million, Assets, avoidable, bankruptcy protection, benefit, bid, Compliance, crypto assets, Customers, defendants, defunct quantitative trading firm, early liquidity, effective lien, Exchange, FTX bankruptcy proceedings, HTC Trading, Law, Lawyers, legal complaint, loan default, outstanding loans, payment, preferential transfers, Proceedings, property, purchase, recover, Sam Bankman-Fried, security interest, state securities commissioner, Texas State Securities Board, Three Arrows Capital, U.S. bankruptcy court, valid, Voyager Digital

What do you think about Alameda Research’s lawsuit against Voyager Digital and HTC Trading? Share your thoughts in the comments section below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Alameda Research

FTX Lawyers Attempt To Question Bankman-Fried’s Family And Inner Circle For Financial Insight

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FTX Lawyers Attempt To Question Bankman-Fried’s Family And Inner Circle For Financial Insight

According to court documents in the FTX bankruptcy case, the company’s attorneys seek to subpoena FTX co-founder Sam Bankman-Fried, his brother Gabriel Bankman-Fried, and his parents, Joseph Bankman and Barbara Fried. Additionally, the attorneys intend to question some of Bankman-Fried’s top deputies, including FTX co-founder Gary Wang, ex-Alameda Research CEO Caroline Ellison, the former chief operating officer Constance Wang, and the exchange’s former director of engineering Nishad Singh.

FTX Attorneys Push for Subpoena of Co-Founder, Associates, Parents, and Brother

Lawyers for FTX Trading Ltd. and the bankruptcy case‘s official creditors committee filed a motion that aims to question Sam Bankman-Fried (SBF), his parents, his brother, and a few of the former CEO’s top lieutenants. The lawyers contend that specific insiders associated with Bankman-Fried’s dealings could provide much-needed insight into financial matters.

“Certain insiders are currently cooperating with the debtors to provide important information. But others are not, and thus authorization to issue subpoenas to those with the missing information is critical to the debtors’ and committee’s recovery efforts,” the joint motion details.

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The current FTX CEO, John J. Ray III, told Congress that Joseph Bankman and “the family certainly received payments” from FTX. Bankman and Barbara Fried have not been charged with any wrongdoing, but the recent court filing claims they both had associations with the firm. The filing alleges that Fried’s political action committee (PAC) Mind the Gap received funds from FTX. Barbara Fried “has ignored the requests altogether,” the joint motion discloses. Bankman allegedly gave tax advice to staff and was involved in linking FTX with the company’s first litigation firm, the court filing explains.

“The insiders are best positioned to assist” the case, FTX attorneys further insist in the latest filing. The document notes that lawyers want to question Gabriel Bankman-Fried, SBF’s brother. The filing talks about Bankman-Fried’s brother’s nonprofit, Guarding Against Pandemics. It mentions the alleged political lobbying that reportedly took place near the U.S. Capitol at a “multimillion-dollar property,” which “the debtors believe was purchased using misappropriated customer funds.” In addition to Bankman-Fried’s brother and parents, Constance Wang, Caroline Ellison, Gary Wang, and Nishad Singh are mentioned in the request.

The U.S. Bankruptcy Court for the District of Delaware judge, John Dorsey, must approve the request to subpoena SBF and the members of his inner circle. Bankman-Fried has been indicted by a federal grand jury in Manhattan and faces charges of “conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission and commit campaign finance violations.” SBF currently awaits trial over the charges, which is scheduled for Oct. 3, 2023.

“Debtors have not received meaningful engagement or any response from Singh or Mr. Gabriel Bankman-Fried,” the FTX attorneys added in the filing.

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Alameda Research, alleged lobbying, Bankruptcy, Bankruptcy Case, Barbara Fried, co-founder, Congress, Court Filing, Court request, financial insight, ftx, FTX collapse, FTX Company, Gabriel Bankman-Fried, Guarding Against Pandemics, Inner Circle, John J. Ray III, Joseph Bankman, Lawyers, litigation firm, Mind The Gap, Nishad Singh, official creditors committee, Payments, political action committee, Sam Bankman-Fried, sbf, Subpoena, tax advice, Top Deputies, U.S. Capitol

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What do you think the outcome of this court request will be? Share your thoughts in the comments below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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