Department of Justice prosecutors plan to seize $465 million of Robinhood shares tied to FTX founder and former CEO Sam Bankman-Fried, who has been charged with fraud in the collapse of the FTX cryptocurrency exchange.
In May, Bankman-Fried purchased a 7.6 percent stake in Robinhood, worth about $648 million at the time, according to a Securities and Exchange Commission (SEC) filing. The shares of the stock-trading app soared more than 20 percent on the revelation.
Court documents revealed that Bankman-Fried and FTX co-founder Gary Wang borrowed $546 million from Alameda Research through promissory notes in April and May. They then used those funds to capitalize Emergent Fidelity Technologies, which had purchased a sizable stake in the mobile trading app….