FTX debtors can issue subpoenas to company 'insiders', says court

The justice overseeing crypto speech FTX’s bankruptcy lawsuit has granted a question allowing the firm’s debtors to petition subpoenas for accusation and documents from erstwhile colleagues and household members of Sam Bankman-Fried.

In a Feb. 8 filing, Judge John Dorsey said FTX debtors were authorized nether bankruptcy tribunal rules to contented subpoenas to definite individuals “for the accumulation of documents, electronically stored information, oregon tangible things”. The archetypal question filed connected Jan. 25 defined the people of the subpoenas arsenic insiders not “currently cooperating with the Debtors to supply important information” — a database which includes Bankman-Fried, erstwhile Alameda Research CEO Caroline Ellison, FTX co-founder Gary Wang, and members of SBF’s contiguous family.

“The Debtors attempted to confer with each of the Insiders to put a mutually agreeable date, time, spot and scope of production,” said the Jan. 25 filing. “To date, nary of the Insiders taxable to this Motion person agreed to supply the requested information.”

Judge Dorsey granted a abstracted question connected Feb. 8 ordering subpoenas of “relevant 3rd parties” related to find of a confidential investigation. The archetypal filing from January did not see the names of the 3rd parties, but added they could “possess circumstantial grounds captious to the Debtors’ plus betterment efforts and investigation” into $300 cardinal successful unauthorized transfers.

Proceedings are underway successful the bankruptcy tribunal to consider whether to delegate an autarkic examiner to FTX’s lawsuit operating alongside the debtors. Judge Dorsey is expected to regularisation connected the substance successful a Feb. 9 hearing.

Related: FTX seeks to claw backmost governmental donations by the extremity of February

In transgression court, Bankman-Fried faces 8 counts related to alleged illicit transactions and question of funds betwixt FTX and Alameda. On Feb. 7, U.S. Attorney for the Southern District of New York Damian Williams petitioned the tribunal to delay civilian proceedings from the Securities and Exchange Commission and Commodity Futures Trading Commission against SBF “until the decision of the parallel transgression case”.