FTX Bankruptcy Lawyers Accused of Conflict of Interest
The post FTX Bankruptcy Lawyers Accused of Conflict of Interest appeared on BitcoinEthereumNews.com.
A class action lawsuit has been filed against Sullivan and Cromwell, the law firm that is in charge of the bankruptcy proceedings of the troubled cryptocurrency exchange, FTX. FTX creditors accuse the company of having been too involved with the exchange before its fall, thus casting multiple questions regarding its objectivity in the bankruptcy procedure. The lawsuit points out the long-standing relationships and previous business deals between Sullivan and Cromwell and FTX, thereby raising doubt about the impartiality of the bankruptcy hearing. Legal Entanglements and Allegations The lawsuit focuses on Sullivan and Cromwell’s role as outside attorneys for FTX 16 months preceding its failure. At this time, the firm was said to have made $8.5 million through legal fees, making people wonder about its heavy monetary connection to the exchange. The role played by Ryne Miller, who used to work for Sullivan and Cromwell and engaged with FTX as General Counsel in 2021, receives a lot of attention. The move of Miller to FTX and then the company’s later decision to involve Sullivan and Cromwell in various legal matters, including important acquisitions and bids, are referred to as evidence of the law firm’s incestuous relationship with the exchange. In addition, the suit claims that Sullivan and Cromwell obtained proprietary information about FTX’s operations and backed the company’s deceitful acts. It indicates the firm’s representation of closely associated entities of FTX and its controversial financial moves, such as the acquisition of Robinhood stock via a special purpose vehicle that FTX customer funds funded. Gains In Midst Of FTX Bankruptcy The financial benefits that Sullivan and Cromwell got from its relation with FTX are now being investigated as the exchange is on the verge of bankruptcy. Only the fees that the law firm has earned from the bankruptcy proceedings have exceeded $180…
Filed under: News - @ February 18, 2024 3:54 am