Crypto Exchange FTX Spending Thousands on Bankruptcy Lawyers
Around $53,000 per hour has been spent by crypto exchange FTX on bankruptcy lawyers and advisers over the three months leading up to October 31, according to recent compensation filings. From August 1 to October 31, bankruptcy lawyers charged a total of at least $118.1 million. The largest bill came from management consulting firm Alvarez and Marshall, which charged $35.8 million for its services during that period. Sullivan and Cromwell, a global law firm, came in second place with a charge of $31.8 million. Other advisory firms billed a total of over $26.8 million.
Concerns Raised About Billings
An earlier report filed by the court-appointed fee examiner revealed concerns about the billings submitted by larger advisory firms such as Sullivan and Cromwell and Alvarez and Marshall. The report highlighted issues such as top-heavy staffing, excessive meeting attendance, fees related to non-working travel time, and procedural deficiencies in time entries.
Total Legal Fees Approximate $350 Million
A pseudonymous FTX creditor shared figures suggesting that approximately $350 million has been fully paid in legal fees since the FTX bankruptcy case began. This estimate indicates that there may still be around $1.45 billion remaining in professional fees.
Hot Take: FTX Faces Significant Costs Amidst Bankruptcy Proceedings
FTX’s expenditure on bankruptcy lawyers and advisers highlights the significant costs associated with navigating the bankruptcy process. With millions of dollars being spent on legal fees alone, it is clear that bankruptcy cases can be lengthy and expensive endeavors. The concerns raised about billing practices also indicate the need for transparency and accountability in managing these costs. As FTX continues its bankruptcy proceedings, it will be important to closely monitor and manage these expenses to ensure a fair and efficient resolution.
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