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FTX lawyers accuse Sam Bankman-Fried of ‘Twitter attack’

FTX lawyers have accused Sam Bankman-Fried of trying to circumvent the bankruptcy of his crypto empire through a “Twitter attack.”

In recent weeks, Bankman-Fried has made numerous tweets and blog posts accusing Sullivan & Cromwell, the law firm representing FTX in Chapter 11 proceedings, of pressuring him to push the companies out. into bankruptcy, including the US branch of FTX. Former billionaire claims to be solvent. The company has denied those claims.

James Bromley, a partner at Sullivan and Cromwell, said in court on Friday that the company was “fighting a specter” in trying to address Bankman-Fried’s public criticism of the practice. company role represented FTX in bankruptcy without being able to question him in court.

“One of the things that debtors often face in these cases is being hacked by Twitter,” he said.

The comments came at a hearing in which the bankruptcy court considered petitions by two FTX customers who sought to block Sullivan’s appointment because of what they claimed were conflicts. benefits generated by the company’s previous work for the crypto team.

The judge ultimately denied the motion. “There is no evidence of any real conflict here,” Judge John Dorsey said.

The decision paved the way for Sullivan to earn millions of dollars in agency fees for FTX as it tries to reimburse account holders. Dorsey noted that FTX has hired other law firms that can exploit if any conflicts arise.

The hearing and Mr. Bromley’s comments indicate how the famous FTX case and the social media storm surrounding the incident will further complicate efforts to restructure the crypto exchange and return amount owed to millions of creditors.

Another former FTX insider, top attorney Dan Friedberg, on Thursday brought new charges against Sullivan of alleged conflicts of interest in a last-minute court filing ahead of the hearing. bare. The judge described the file as full of “rumors, speculations and rumours” and “not something that I would allow to be included as evidence”.

Earlier this week, Sullivan filed dozens of additional pages detailing the nearly $10 million worth of legal work it did for Bankman-Fried companies before they were granted bankruptcy protection in 2012. last. Two former Sullivan attorneys have also held senior legal positions at FTX.

Bromley on Friday said the company should have been more willing from the start in disclosing the extent of its past association with the failed crypto group. “In retrospect, Your Honor, we should have gone further in our original statement,” he told the court.

He also claimed Bankman-Fried, who has pleaded not guilty to U.S. fraud, and other insiders who had “bred the company to its knees” concerned about the information Sullivan was giving the companies. prosecutors and regulators.

“They can throw stones at the debtor’s attorney who is providing information to prosecutors,” he said.

The US Department of Justice objected to the company’s initial disclosure of its work to FTX and pushed for more information. Government attorneys on Friday said they were satisfied with the additional details Sullivan provided.

Sullivan and Bankman-Fried declined to comment.



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