Judge Denies Appointment of Independent Examiner in FTX Bankruptcy

Delaware bankruptcy court judge sided with the bankrupt crypto exchange and said there is no need to appoint an examiner to conduct "yet another costly investigation that would slow the progress" of the case.

AccessTimeIconFeb 15, 2023 at 3:27 p.m. UTC
Updated Feb 15, 2023 at 4:15 p.m. UTC

A U.S. judge denied a motion to appoint an independent examiner into the FTX bankruptcy case during a Wednesday hearing.

A bipartisan group of four U.S. senators sent a letter to the judge in January, calling for an independent examiner to be appointed. Juliet Sarkessian, a representative for the U.S. Trustee, a branch of the Department of Justice, later argued the decision was out of the hands of Judge John Dorsey, of the Bankruptcy Court of Delaware in a case of this scale.

The judge sided with representatives for FTX, who previously argued there was no need to appoint an examiner to "conduct yet another costly investigation that would slow the progress of these cases."

Lawyers for FTX previously said an independent examination could end up costing the estate $100 million.

"I agree with the objectors and will deny the motion to appoint an examiner," the judge said.

During the same hearing, FTX's court-appointed joint provisional liquidators in the Bahamas said the company had transferred some $7.7 billion in assets from the Bahamian entities to U.S. units.


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Sandali Handagama

Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She does not own any crypto.