February 8, 2025
Robinhood will buy back Bankman-Fried stake from the US government for 5.7 million – Reuters

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Robinhood Markets, Inc. is seen at a pop-up event on Wall Street following the company’s IPO on July 29, 2021 in New York City, US. Reuters/Andrew Kelly/File Photo Licensing rights granted

Sep 1 (Reuters) – Robinhood (HOOD.O) said on Friday it has entered into a $605.7 million share repurchase agreement with the United States Marshals Service (USMS) to buy back stock from Sam Bankman-Fried’s Emergent Fidelity Technologies .

Robinhood shares were seized and subsequently transferred to US government custody after Bankman-Fried’s FTX and Emergent filed for bankruptcy protection last year. Bankman-Fried has pleaded not guilty to charges of criminal fraud and conspiracy arising from the November 2022 collapse of FTX.

Shares of Robinhood climbed more than 3% in premarket trading on the news.

The online brokerage said 55.3 million shares would be sold at $10.96 per share.

Court records showed that US District Judge Lewis Kaplan in Manhattan approved the deal. Kaplan, who is overseeing the Bankman-Fried criminal case, called Robinhood’s proposed share purchase agreement “reasonable” and “in the best interests of the stakeholders concerned” in an order dated Friday, August 28.

Robinhood first disclosed its intention to buy back the stake in February, saying the company’s board had authorized it to buy most or all of the stock.

Just six months before his company filed for bankruptcy last November, Bankman-Fried disclosed a 7.6% stake in Robinhood, but said he had no intention of taking control of the retail trading platform. He told Reuters at the time that FTX was “excited about the business potential of Robinhood and the potential ways to partner with them.”

Bankman-Fried built an estimated $26 billion net worth as bitcoin and other digital assets skyrocketed and became an influential political donor in the United States, but the collapse of FTX wiped out her fortune.

Kaplan earlier this month ordered Bankman-Fried to be jailed ahead of an October trial, which found the former billionaire held on $250 million bail at his parents’ Palo Alto, California home. The witnesses had been tampered with.

Reporting by Manya Saini in Bengaluru and Hannah Lang in Washington; Additional reporting by Luke Cohen in New York; Editing by Devika Shyamnath and Mark Potter

Our Standards: The Thomson Reuters Trust Principles.

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Manya Saini reports on leading publicly listed US financial firms including Wall Street’s biggest banks, card companies, asset managers and fintechs. It also covers late stage venture capital funds, initial public offerings on US exchanges as well as news and regulatory developments in the cryptocurrency industry. His work typically appears in the Finance, Markets, Trading and Future of Money section of the website. Contact: 9958867986

Hannah Lang covers fintech and cryptocurrencies, including the businesses driving the industry and the policy developments governing the sector. Hannah previously worked at American Banker where she covered bank regulation and the Federal Reserve. She graduated from the University of Maryland, College Park and lives in Washington, DC.

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