Hot topic in the new year 2023 surrounded by FTX’s new leadership vs. Bahamian regulators. The Securities Commission of the Bahamas (SCB) published a statement which sought to correct “Material Misstatements” made by Chapter 11 debtors, as per media release on January 2, 2023.
New disputes from FTX new Management
After Sam Bankman-Fried led crypto exchange FTX was fried up due to liquidity crunch, forced them to seek its way out from insolvency via filing bankruptcy on November 11, 2022. John Ray III is now appointed as a new CEO of the drained company.
Mr. Ray is well known as a lawyer who is famous for his specialization in restructuring troubled companies. He has helped firms manage from the downfall of some of the largest failures in history, for example, the implosion of energy titan Enron after its accounting scandal back in 2001. The new FTX CEO also recovered more than $828 million for creditors, told The New York Times.
According to Bloomberg, in mid-December 2022, FTX lawyers have denied Bahamas officials asking for immediate “live” access to the company’s systems, claiming that the government regulators can’t be trusted. Whereas Bahamian liquidators disputed that they are entitled to enter into FTX computer network in order to clean up a locally based subsidiary.
The SCB remarked that: “The US Debtors’ continued lack of diligence when making public statement concerning the Commission is disappointing, and reflects a cavalier attitude towards the truth and towards The Bahamas that has been displayed by the current officers of the Chapter 11 Debtors from the date of their appointment by Sam Bankman-Fried.”
Authorities goes strict on FTX
As per media reports, the SCB recently seized over $3.5 million of FTX assets, as per order laid by the Bahamas Supreme Court on December 29, 2022. The digital assets were obtained from its parent company, FTX Digital Markets Ltd.
According to The Guardian, SBF was accused of fraudulent charges in the U.S, charged with conspiracy to commit money laundering, violating campaign finance laws and defrauding FTX investors. He was arrested in Nassau, Bahamas at his home on December 12, 2022, and released on bail agreement of $250 million bond, finally extradited to the U.S. after spending a few days in FOX Hill prison amid “harsh” situations.
As per news reports, FTX new management stated in an early filing, claiming that “credible evidence that the Bahamian government is responsible for directing unauthorized access to the Debtors’ systems for the purpose of obtaining digital assets of the Debtors.”
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Source: https://www.thecoinrepublic.com/2023/01/03/ftx-new-management-argues-with-bahamian-regulators-heres-what-happened/