Credit: Timon/Adobe Stock FTX Examiner Clears S&C, Questions Fenwick's Knowledge of Fraud
A court-appointed examiner cleared Sullivan & Cromwell of allegations that the law firm was aware of the fraud as it handled 20 matters for FTX before its bankruptcy filing.
May 24, 2024 at 02:49 PM
4 minute read
What You Need to Know
- A court-appointed examiner in the bankruptcy of FTX cleared Sullivan & Cromwell of allegations by creditors and whistleblowers that the law firm knew of the ongoing fraud at the cryptocurrency exchange.
- Sullivan & Cromwell handled 20 matters for FTX before the company filed for bankruptcy in November 2022.
- The examiner also found that Fenwick & West was closely involved with "core aspects of FTX Group's improper operations and management."
Sullivan & Cromwell was not aware of the ongoing fraud at FTX while the law firm represented the cryptocurrency exchange in 20 matters before becoming its debtor counsel, a court-appointed examiner stated in a report Thursday.
However, examiner Robert Cleary of Patterson Belknap Webb & Tyler asked the U.S. Bankruptcy Court for the District of Delaware to conduct two additional investigations into Sullivan & Cromwell's prepetition work for FTX, which occurred in the 16 months before the company's November 2022 bankruptcy filing.
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