Bankman-Fried Says He Needs Robinhood Shares to Pay Legal Bills

Former FTX CEO Sam Bankman-Fried wants Robinhood stock seized by the U.S. returned to him, claiming the shares are his property.  

In a Thursday (Jan. 5) U.S. court filing, his lawyers argued that the shares are not part of the FTX bankruptcy case, nor is the company that owns the Robinhood shares — Emergent Fidelity Technology, of which Bankman-Fried owns 90%. 

They added that while FTX debtors have failed to show that they would be “irreparably injured” by denial of the claim to the shares, Bankman-Fried needs some of the assets to pay for his criminal defense. 

“Mr. Bankman-Fried has not been found criminally or civilly liable for fraud, and it is improper for the FTX Debtors to ask the Court to simply assume that everything Mr. Bankman-Fried ever touched is presumptively fraudulent,” his lawyers said in the filing

On the same day, two other entities filed requests for the Robinhood shares: crypto lender BlockFi, from which Bankman-Fried had taken loans and pledged the shares as collateral, and the joint provisional liquidators for Emergent Fidelity Technology in Antigua, Bloomberg reported Friday (Jan. 6). 

The Robinhood shares were among the assets linked to FTX that the United States seized on Wednesday (Jan. 4). 

The question of ownership of the shares had become more complicated when Bankman-Fried told a court before he was arrested in the Bahamas that he and FTX co-founder Gary Wang had borrowed $546 million from Alameda Research to capitalize Emergent Fidelity Technologies. 

Before that report, BlockFi, FTX Group and Bankman-Fried had all claimed ownership of the shares. 

What’s more, the shares are among the most valuable assets linked to FTX. 

As Bloomberg reported on Dec. 22, “The Robinhood shares played a prominent role in the run-up to FTX’s implosion. They were touted in a spreadsheet as being some of the crypto empire’s most valuable, liquid assets amid efforts to drum up rescue financing.” 

In early December, Robinhood CEO Vlad Tenev told CNBC that he was not surprised that the shares were one of the more valuable assets linked to FTX and that he did not have any more information about the fate of the shares than CNBC. 

“We’re just watching this unfold and … it’s going to be locked up in bankruptcy proceedings, most likely for some time,” Tenev said at the time. “And so we’re just kind of seeing how that plays out.”