<\/p>\n
The United States Securities and Exchange Commission (SEC) has initiated legal proceedings against an accounting firm that had previously provided services to the now-defunct cryptocurrency exchange FTX.<\/p>\n
According to a September 29 statement, the SEC alleged that Prager Metis provided auditing services to its clients without maintaining the necessary independence, as it allegedly continued to offer accounting services, a practice that is prohibited in the industry.<\/p>\n
The SEC claims that these activities spanned approximately three years:<\/p>\n
\u201cAs alleged in our complaint, over a period of nearly three years, Prager\u2019s audits, reviews, and exams fell short of these fundamental principles. Our complaint is an important reminder that auditor independence is crucial to investor protection.\u201d<\/p><\/blockquote>\n
While the statement doesn’t explicitly mention FTX or any other clients, it does emphasize that there were allegedly “hundreds” of auditor independence violations throughout the three-year period.<\/p>\n
Furthermore, a previous court filing pointed out that the FTX Group engaged Metis to audit FTX US and FTX at some point in 2021. FTX declared bankruptcy in November 2022.\u00a0<\/p>\n
The filing claimed that given Bankman-Fried’s public announcement of previous FTX audit results, Metis should have been aware that its work would be utilized by FTX to enhance public trust.<\/p>\n
Related:\u00a0FTX founder\u2019s plea for temporary release should be denied, prosecution says<\/em><\/strong><\/p>\n
It was previously reported over concerns over the information presented in the financial statements.<\/p>\n
On Jan. 25, current FTX CEO John Ray told a bankruptcy court that he had \u201csubstantial concerns as to the information presented in these audited financial statements.\u201d<\/p>\n
Furthermore, Senators Elizabeth Warren and Ron Wyden raised concerns about the firm’s impartiality, contending that they functioned as advocates for the crypto industry.<\/p>\n
Meanwhile, a law firm that provided services to FTX has come under scrutiny in recent times.<\/p>\n
In a Sept. 21 court filing, plaintiffs allege that Fenwick & West can be held liable because it reportedly exceeded the norm when it came to its service offerings to FTX.<\/p>\n
However, Fenwick & West denies that it can be held responsible as it falls outside the scope of the representation of the client. <\/p>\n
Magazine:\u00a0Blockchain detectives: Mt. Gox collapse saw birth of Chainalysis<\/em><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
The United States Securities and Exchange Commission (SEC) has initiated legal proceedings against an accounting firm that had previously provided services to the now-defunct cryptocurrency exchange FTX. According to a September 29 statement, the SEC alleged that Prager Metis provided auditing services to its clients without maintaining the necessary independence, as it allegedly continued to […]<\/p>\n","protected":false},"author":1,"featured_media":23205,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","om_disable_all_campaigns":false,"footnotes":""},"categories":[42],"tags":[],"class_list":["post-23204","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto"],"yoast_head":"\n
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