Several US states have taken legal action against FTX. Officials in some of those states have asked a federal bankruptcy court judge to appoint a third-party reviewer of FTX’s finances. But this possibility does not please everyone.
Why Appoint an Independent Examiner for FTX Finances
According to the document filed by officials of a dozen US states, the opacity of FTX’s finances has reached new heights. To see more clearly, the intervention of an independent and specialized examiner would be necessary. Texas was the first state to file this request. We learned by The Block only 16 others joined: Alaska, Arkansas, California, Florida, Hawaii, Idaho, Illinois, Kentucky, Maine, Maryland, New Hampshire, New Jersey, North Carolina, Oklahoma, Tennessee and Washington.
According to these officials, Given the lack of transparency about the financial position and assets of debtors, and the continued ongoing regulatory investigations, the appointment of a reviewer with specific guidelines as to his or her duties is not only appropriate and in the best interest of creditors, but mandatory “. Indeed, American bankruptcy law offers this possibility.
Would a third-party reviewer be more competent to settle the FTX case?
A more specialized external player would indeed be better able to shed light on the state of the finances of FTX and all its subsidiaries. Let’s not forget that since the beginning of this case, FTX has done everything to hide funds. It seems that SBK has no intention of repaying its creditors. At this time, the only financial reports Justice is working with are from FTX executives. The latter declared remaining assets of approximately $1.4 billion. This is not the first time that an independent examiner has been required for a bankruptcy in the crypto sphere. Indeed, this was already the case with Celcius.
The executives of the bankrupt exchange and their lawyers vehemently rejected hiring a third party to review FTX’s finances. They have thus joined some of the company’s creditors and provisional liquidators in this idea. According to them, it could cost FTX 100 million, when every dollar counts. But without this work, will they ever see the trace of all the missing money? More importantly, will they be able to recover embezzled funds ?
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