3 months ago
FTX examiner Robert J. Cleary has sought tribunal support to further analyse the relation of instrumentality steadfast Sullivan & Cromwell LLP (S&C) and different matters astatine the defunct exchange, according to a June 10 tribunal filing.
The examiner said these investigations are expected to instrumentality 10 weeks and outgo $3 million.
S&C’s engagement questioned
The June 10 question revealed that the examiner would analyse the ineligible services Sullivan & Cromwell LLP (S&C) provided to Sam Bankman-Fried, the convicted laminitis of the now-defunct exchange, during his acquisition of Robinhood shares.
Cleary aims to find if S&C was alert of fraudulent activities wrong FTX and whether immoderate conflicts of involvement were overlooked erstwhile the tribunal approved their retention arsenic counsel. According to the filing:
“The probe would discern much mostly if, successful transportation with oregon arsenic a effect of this representation, S&C advised on, possessed oregon gained cognition of, oregon had been made alert of captious facts relating to the FTX Group’s misconduct.”
If S&C’s practice of SBF successful acquiring Robinhood Markets shares is recovered improper oregon conflicted, it could person important ineligible and fiscal implications for each parties involved.
In May 2022, SBF acquired a 7.6% involvement successful Robinhood for $648.3 million. After FTX’s collapse, the US Department of Justice seized these shares, which became the taxable of disputes among assorted FTX-related parties.
S&C’s broader engagement with FTX has besides sparked controversy. In December 2022, Bankman-Fried claimed S&C pressured him into declaring bankruptcy to gain ineligible fees. Additionally, FTX creditors person filed a class-action suit against the firm, arguing that it should beryllium held partially liable for the exchange’s collapse.
Other FTX investigations
Cleary’s question besides sought to probe into the pre-bankruptcy merchantability of Ledger Holdings Inc. (LHI) and the equilibrium expanse holes successful FTX US.
The examiner said inquiries into these matters would bolster nationalist assurance successful the bankruptcy process and uncover immoderate misconduct oregon issues related to it. He added:
“Further probe and reporting connected FTX.US’s insolvency could beforehand nationalist assurance successful the bankruptcy process by refuting Bankman-Fried’s mendacious claims that FTX.US was solvent arsenic of the Petition Date.”
The station New probe sought into Sullivan&Cromwell’s relation successful FTX collapse appeared archetypal connected CryptoSlate.
English (US) 