A lawyer representing the interim liquidators overseeing FTX’s operations in the Bahamas has disputed allegations that the country’s authorities were using the collapse of the cryptocurrency exchange to first benefit its residents.
At a December 16 hearing in the FTX Trading bankruptcy proceeding, White & Case partner Jason Zakia said the claims made by the debtors about the assets and the Bahamian authorities were “totally unfounded.” The legal team represented the provisional liquidators of FTX Digital Markets — the firm’s Bahamas operations — whose appointments were approved by the country’s Supreme Court in November, and had “no involvement” in FTX’s downfall before its bankruptcyaccording to Zakia.
“In any international case like this, there are a multitude of jurisdictions that have legitimate and important interests and that certainly includes the Bahamas.”Zakia said. “The Bahamian legal system is an independent legal system that must be respected. There have been many accusations and insinuations leveled against the Bahamas: against the Bahamian government, against the Bahamian legal system.”
He clarified:
“One of the accusations […] that the Bahamians were somehow facilitating out-of-system payments to Bahamian residents in preference to other creditors. When you look at the evidence, they have that exactly backwards. [Los liquidadores de provisiones conjuntas] They were specifically designated as part of an effort to stop such activity.”
FTX filed for Chapter 11 bankruptcy in the US District of Delaware on November 11. The bankruptcy court has held some hearings as part of proceedings dealing with how the company’s assets can be managed amidst the interests of FTX’s debtors and creditors. The next public hearing is scheduled for January 11, which will likely address the cryptocurrency exchange’s naming rights deal for the FTX Arena.
In the Bahamas, Former FTX CEO Sam Bankman-Fried was sent to prison following a bail hearing on December 13 in connection with the US Department of Justice charges. The government agency has warned the people involved that it was “not done” with the arrests.
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