FTX paid $12M retainer to a New York law firm before bankruptcy filing

Defunct crypto speech FTX paid a retainer of $12 cardinal to bankruptcy lawyers arsenic information for outgo of its fees and expenses amid Chapter 11 bankruptcy proceedings, shows a tribunal filing dated Dec. 21.

Sullivan & Cromwell LLP (S&C), a instrumentality steadfast headquartered successful New York City, received $12 cardinal from West Realm Shires Services Inc. connected behalf of FTX for ineligible services. In addition, the filing confirmed that implicit the past 90 days, i.e., since Aug. 26, 2022, FTX paid astir $3.5 cardinal to S&C.

Snippet of the tribunal filing revealing FTX's humanities payments to S&C instrumentality firm. Source: aboutblaw.com

Based connected the accusation provided, FTX paid astatine slightest $15.5 cardinal to avail and clasp the ineligible services of S&C. The filing further revealed that S&C presently holds astir $9 cardinal of the $12 cardinal retainer amount.

Following the bid of payments, FTX filed for bankruptcy connected Nov. 11, which was accompanied by the CEO Sam Bankman-Fried’s resignation. As a effect of the consequent shutdown of the crypto exchange, FTX investors mislaid entree to the funds stored connected the exchange.

For immoderate exchanges, regaining capitalist assurance meant sharing grounds of the beingness of users’ funds via proof-of-reserve (POR) initiatives. On the different extremity of the spectrum, Paxful CEO Ray Youssef, sided with the thought of Bitcoin (BTC) self-custody.

Related: Crypto Twitter confused by SBF’s $250M bail and a instrumentality to luxury

District Judge Ronnie Abrams withdrew her information from the FTX case aft revealing that a instrumentality firm, wherever her hubby works arsenic a partner, had advised the speech successful 2021.

While clarifying that her hubby had nary engagement successful immoderate of these representations, she added:

“Nonetheless, to debar immoderate imaginable conflict, oregon the quality of one, the Court hereby rescues itself from this action.”

Judge Abrams’ withdrawal from the FTX lawsuit was aimed astatine eradicating immoderate struggle of involvement successful the FTX case.