SBF's lawyers filed court documents to safeguard the former FTX CEO's 56 million Robinhood shares.
Lawyers argue that SBF requires the funds to cover legal fees.
Crypto Twitter criticized SBF for attempting to protect assets he allegedly obtained fraudulently.
In line with this, the lawyers of disgraced FTX co-founder Sam Bankman-Fried filed an objection on Jan 06 to safeguard SBF's Robinhood shares from the FTX bankruptcy estate.
Sam Bankman-Fried is attempting to persuade a US court that he should be able to access $450 million in Robinhood shares to help pay for his legal fees. SBF's lawyers argued that his Robinhood shares are managed by Emergent Fidelity Technologies, which is not a part of the estate.
The issue is that the Department of Justice, which does not believe the 56 million shares of Robinhood were the property of the bankrupt FTX estate, attempted to seize the shares on Wednesday. Another issue is that both FTX and BlockFi have stakes in the company. While FTX's creditors hope the shares will help them recover their losses.
SBF owns a 90% stake in Emergent, which revealed the equity acquisition in a separate filing with the US Securities and Exchange Commission (SEC). Bankman-Fried is said to have borrowed money from Alameda to fund the stock acquisition.
According to FTX lawyers, FTX debtors can only recover the shares if they can demonstrate that Alameda unlawfully transferred them to Emergent.
The FTX founder, whose paper fortune quickly vanished after FTX filed for bankruptcy on November 11, 2022, reportedly needs the shares to cover his legal fees. As per reports, Bankman-Fried attempted unsuccessfully to sell his Robinhood shares in order to save FTX prior to the bankruptcy filing.
His lawyers argued that a defendant's financial inability to plead their case has substantial consequences, whereas FTX Debtors face simply a potential economic loss.
Needless to say, crypto Twitter was not pleased with the filing.
An NFT artist called the filing "typical rich baby behavior," while others argued that SBF's attempt to keep stolen funds in order to defend himself against fraud charges is absurd.
A Pseudonymous Bitcoin trader argued that SBF didn't need $400 million or more to defend himself. Meanwhile, a judge has scheduled Bankman-Fried's trial date for October 2, 2023.
Bankman-Fried’s move is the latest in a long-running battle over ownership of the shares. The shares, which were once valued at more than $600 million, have plummeted since they were placed in legal uncertainty.
What are your thoughts on the latest development in the FTX/SBF drama? Will SBF be given the rights to the HOOD's shares in order to pay his legal fees? Please share your valuable thoughts in the comment section below.
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