Report Reveals Limited Accounting Records, Commingled Funds at FTX Digital Markets in the Bahamas

Report Reveals Limited Accounting Records, Commingled Funds at FTX Digital Markets in the Bahamas

PWC, one of the ‘Big Four’ auditors and among the largest professional services networks globally, recently published a report on FTX Digital Markets, the bankrupt crypto exchange’s Bahamian subsidiary. The report indicates that the entity’s accounting records have been limited, and it also noted that there is “little distinction between what represents potentially client monies and corporate funds.” FTX Joint Provisional Liquidators Continue Investigations Into Bahamian Subsidiary

In mid-November 2022, following the Chapter 11 bankruptcy filing by the exchange FTX and its large number of subsidiaries, The Bahamas’ regulator appointed Kevin Cambridge and Peter Greaves from PWC as the joint provisional FTX liquidators in the proceedings. PWC has recently published a report that shows the crypto exchange’s Bahamian entity FTX Digital Markets reportedly commingled client funds.

FTX Digital Markets essentially held “limited accounting records,” and the PWC auditors noted that there “appears to have been little distinction between what represents potentially client monies and corporate funds.” Additionally, along with the alleged commingling of funds, data was reportedly commingled as well between the company’s wider affiliates “with little or no segregation applied.”

The auditors discovered $219.5 million in cash held at various banks, and requests have been made to the financial institutions to retrieve the funds. PWC also discussed the various properties purchased in The Bahamas by FTX executives, and it further noted that FTX Digital also owns about $3 million in ancillary assets. In addition to the assets discovered, a significant portion of the crypto assets is not under the joint provisional FTX liquidators’ control due to the $323 million hack stemming from FTX International.

“The [joint provisional liquidators] have requested the transfer of $46.7 million in [tether] from an account in the name of FTX Digital, and they are waiting for the transfer of these assets to their custody,” the report from the PWC auditors further discloses. The report also calls for further investigations into the company’s “cash management,” “antecedent transactions,” and “customer migration.” FTX’s joint provisional liquidators say they continue to employ about 16 individuals for ongoing investigations and research into the “possibility of restructuring the business.” Tags in this story affiliates, antecedent transactions, Assets, auditor, auditors, Bahamian subsidiary, Bankruptcy, Big Four, Cash, cash management, client monies, commingled funds, corporate funds, crypto exchange, cryptocurrency industry, customer migration, data commingling, detecting, Financial Institutions, ftx, Investigations, Issues, joint provisional liquidators, Kevin Cambridge, limited accounting records, Peter Greaves, professional services, PwC, PWC FTX Report, PWC Report, restructuring, Tether

What do you think about the recent report from PWC concerning the FTX Bahamian subsidiary? Let us know what you think about this subject in the comments section below. Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today. Central Bank of Brazil President States Digital Real Pilot Is Imminent NEWS | 2 hours ago Stanford Alumni Revealed as Co-Signers of FTX Co-Founder"s $250M Bond NEWS | 14 hours ago

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