Feds sold seized Anthropic shares from Bankman-Fried associates; victim payout uncertain

Government acquired stake through criminal forfeiture and sold to existing shareholders, but it is unclear where billions in proceeds will go

By LineZotpaper AI staff

Published27 October 2026

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Illustration: Feds sold seized Anthropic shares from Bankman-Fried associates; victim payout uncertain

The federal government seized and sold Anthropic shares belonging to Caroline Ellison and Nishad Singh, two associates of convicted crypto fraudster Sam Bankman-Fried, but it remains unclear whether the proceeds, potentially worth billions, will be distributed to victims of the FTX collapse or retained by the Justice Department.

Bankman-Fried, Ellison and Singh each invested in Anthropic's 2022 Series B funding round, with Bankman-Fried buying $500 million worth of shares, Singh acquiring $40 million and Ellison $10 million. Bankman-Fried's own stake was liquidated in the FTX bankruptcy for $1.3 billion in 2024, with the largest portion going to an entity affiliated with a United Arab Emirates sovereign wealth fund.

Ellison and Singh were required to forfeit their Anthropic shares as part of their sentences. The government took ownership of Ellison's shares in February 2025 and Singh's in April 2025, according to previously unreported court records. The shares were then sold to existing Anthropic shareholders last year, according to a person familiar with the sale. The identities of the buyers and the price paid remain unknown.

The value of the forfeited shares has soared along with Anthropic's valuation. Olav Sorenson, who teaches venture capital strategy at UCLA, estimates the combined Ellison and Singh stake is worth between $4.17 billion and $5.03 billion based on the $965 billion valuation Anthropic announced in May. PitchBook analyst Harrison Rolfes put the figure at $2.62 billion, and at a $2 trillion IPO valuation the shares would be worth about $5.44 billion.

The Justice Department said during Ellison's sentencing that it would either set up a claims process to compensate victims or work with the FTX bankruptcy estate. The estate, run by law firm Sullivan & Cromwell, had projected earlier in 2024 that all creditors would be repaid in full with interest. Singh's attorney, Andrew Goldstein, told Business Insider that Singh hopes the government is able to quickly distribute proceeds of the sale to FTX victims. White-collar defense attorney Duncan Levin said the forfeiture process is "very opaque" and that disposal of the shares is "completely at the discretion, by law, of the attorney general of the United States." An attorney for Ellison declined to comment.

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Analysis

Why This Matters

The outcome could set a precedent for how forfeited assets from major financial frauds are distributed to victims.
Victims of the $11 billion FTX fraud may receive additional compensation, or the government could retain billions.
The resolution may affect Anthropic's IPO process and shareholder structure, given the significant stake involved.

Background

Sam Bankman-Fried's crypto exchange FTX collapsed in 2022, leading to his conviction for fraud and a 25-year prison sentence. His $500 million investment in Anthropic, made through an Alameda Research affiliate, appreciated substantially after the AI company's valuation soared. Ellison, the former CEO of Alameda Research, and Singh, an FTX executive, pleaded guilty to fraud charges and testified against Bankman-Fried. Their Anthropic shares were forfeited as part of their plea agreements. Anthropic is now the most valuable private company in the world, according to Crunchbase, and is expected to pursue an initial public offering.

Key Perspectives

Andrew Goldstein (attorney for Nishad Singh): Said Singh purchased his shares before participating in the criminal conspiracy and "actually may have had a legitimate legal claim" to the shares but agreed to give them up "because it was the right thing to do." He told Business Insider that Singh hopes the government distributes proceeds to FTX victims quickly. Duncan Levin (white-collar defense attorney): Called the asset forfeiture process "very opaque" and said disposal of the shares is "completely at the discretion, by law, of the attorney general of the United States." Justice Department prosecutors: Said during Ellison's sentencing they would either set up a claims administration process or work with the FTX bankruptcy estate to compensate victims, noting the bankruptcy process had already projected full repayment of creditors. At the time, prosecutors said the FTX creditors largely overlapped with victims.

What to Watch

Anthropic's potential IPO valuation, which will determine the final value of the seized shares.
The Justice Department's decision on whether to distribute proceeds through its remission process or retain them.
Any legal challenges from victims or other parties regarding the disposition of the forfeited assets.

Sources

The feds seized a stake in Anthropic from Sam Bankman-Fried's friends. What happened to the shares? · Business Insider

Checked

12 claims in this story checked against 1 source: 11 supported.

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SupportedThe federal government seized Ellison’s and Singh’s Anthropic shares and sold them to existing Anthropic shareholders.All Content from Business Insider: “The government seized those shares and sold them to existing Anthropic shareholders, according to a person familiar with the sale.”
Partly supportedIt is unclear whether the sale proceeds will go to FTX victims or be retained by the Justice Department, and the story describes those proceeds as potentially worth billions.All Content from Business Insider: “Depending on when they were sold in 2025, the combined shares could have been worth between $300 million and $1.1 billion, according to Sorenson, the UCLA professor.”
SupportedLevin called the forfeiture process “very opaque” and said disposal was “completely at the discretion, by law, of the attorney general of the United States.”All Content from Business Insider: ““It’s a very opaque process,” he said. “It’s completely at the discretion, by law, of the attorney general of the United States.””
SupportedBankman-Fried invested $500 million in Anthropic’s 2022 Series B round.All Content from Business Insider: “Bankman-Fried bought $500 million worth, which according to court records represented 13.56% of Anthropic at the time.”
SupportedSingh invested $40 million in Anthropic shares.All Content from Business Insider: “Singh acquired $40 million in shares, and Ellison acquired $10 million in shares, court records reviewed by Business Insider show.”
SupportedEllison invested $10 million in Anthropic shares.All Content from Business Insider: “Singh acquired $40 million in shares, and Ellison acquired $10 million in shares, court records reviewed by Business Insider show.”
SupportedBankman-Fried’s Anthropic shares were sold in the FTX bankruptcy for $1.3 billion in 2024, with the largest stake going to an entity affiliated with a UAE sovereign wealth fund.All Content from Business Insider: “The estate in 2024 sold Bankman-Fried’s Anthropic shares to a few dozen buyers for a total of $1.3 billion, more than double what he paid. The largest stake went to an entity affiliated with a United Arab Emirates sovereign wealth fund, bankruptcy court filings show.”
SupportedEllison and Singh were required to forfeit their shares, and the government took ownership of Ellison’s in February 2025 and Singh’s in April 2025.All Content from Business Insider: “A federal judge ordered Ellison’s and Singh’s Anthropic shares to be transferred to the federal government, which took ownership of Ellison’s shares in February 2025 and Singh’s in April of that year, according to previously unreported court records.”
SupportedThe shares were sold last year, but the buyers’ identities and the price paid are unknown.All Content from Business Insider: “The Marshals Service sold Singh’s and Ellison’s shares to existing Anthropic investors sometime last year, according to the person with knowledge of the sale. It’s not clear when exactly the agency sold the shares, to which investors, how those investors were chosen, at what price the shares were sold, or how much money the government made in the sale.”
SupportedSorenson estimated the combined shares were worth $4.17 billion to $5.03 billion based on Anthropic’s $965 billion valuation announced in May.All Content from Business Insider: “The Anthropic shares purchased by Singh and Ellison could together be worth between $4.17 billion and $5.03 billion today, based on the $965 billion valuation the company announced this May, according to Olav Sorenson, who teaches venture capital strategy at UCLA.”
SupportedAt Ellison’s sentencing, DOJ prosecutors said they would either set up a claims process to compensate victims or work with the FTX bankruptcy process.All Content from Business Insider: “During Ellison’s sentencing hearing, Justice Department prosecutors told the judge that the DOJ would either set up its own claims administration process to compensate victims, or work with the FTX bankruptcy process to identify victims and provide forfeited funds to them.”
SupportedSingh’s attorney, Andrew Goldstein, said Singh hopes the government can quickly distribute the sale proceeds to FTX victims.All Content from Business Insider: “Reached for comment for this story, Goldstein told Business Insider that Singh hopes the government is able to quickly distribute proceeds of the sale to FTX victims.”