KryptoCurrency

November 24, 2024
Crypto

FTX names Kroll as claims agent, to update users on bankruptcy developments

By akohad Nov18,2022

[ad_1]

Bankrupt crypto exchange FTX has appointed restructuring administration firm Kroll as its agent to track all claims against FTX and ensure interested parties are notified of developments throughout its Chapter 11 bankruptcy case.

Known as the “claims and noticing agent,” Kroll was appointed to the role on Nov. 12 with the news made public on Nov. 17, and aims to compile a database of all claims against FTX Trading and 101 affiliated companies.

At the time of writing, this database lists only eight claims, including one from Singaporean-based blockchain development firm Ethereal Tech for $11.7 million, but will soon be fleshed out as more claims against the group are lodged.

For example, one other case that Kroll has worked on, that of rental car company Hertz, has 62,061 claims against it from its Chapter 11 bankruptcy case.

The eight claims currently included already amount to $40.9 million, though FTX Trading alone is understood to owe customers and investors as much as $8 billion.

Within the filing, the firm has also compiled a list of interested parties it will keep updated on developments, which it acknowledges is incomplete and does not currently include customers.

This list is currently composed of approximately 750 parties who have some kind of interest in the case, with some of the included groups consisting of debtors, banks, landlords, insurance providers, directors, landlords, and regulators.

Some noteworthy names included in the list are National Australia Bank (NAB), Apple, Facebook, JPMorgan, Chainalysis, Wells Fargo, Bank of America, Circle, Stephen Curry, Reddit, and Yuga Labs.

Meanwhile, the number of creditors involved with FTX is thought to be in excess of one million, and corporate securities lawyer Margaret Rosenfeld told Cointelegraph it will take years before any begin to receive any funds back, adding:

“You can’t make creditor distributions until these claims are analyzed. It’s also way too early to speculate on what kind of distribution creditors will get back. Though in mega cases, such as this, full recovery would be unusual.”

Kroll Restructuring Administration is an indirect subsidiary of Kroll LLC, which is one of the world’s largest corporate intelligence companies. Notably, the firm had been employed by Harvey Weinstein on multiple occasions, including when allegations of sexual harassment were brought against him in 2016.

Related: SBF received $1B in personal loans from Alameda: FTX bankruptcy filing

The parent company offers a wide range of services in areas such as environmental, social, and corporate governance (ESG), valuation, compliance, cyber risk, investigations, and corporate finance.

On Nov. 15, regulators in the Bahamas argued that FTX’s new CEO lacks the authority to initiate Chapter 11 proceedings in the United States, with the provisional liquidator overseeing the bankruptcy proceedings of FTX Digital Markets in The Bahamas rejecting the “validity of any purported attempt to place FTX Affiliates in bankruptcy.”