- The media has received the BDO auditors’ report on the DAAG acquisition deal. The company was later renamed FTX Europe.
- In the course of the inspection, BDO specialists found no problems. And the reported value was deemed fair by the organization.
- FTX Trading is seeking to rescind that agreement and recover $323 million from Bankman-Fried, as well as the unit’s former top management.
In 2022, international accounting firm BDO audited FTX Trading’s exchange deal with Swiss firm Digital Assets AG (DAAG), The Block reported. The organization said there is nothing suspicious about the agreement and the reported value is more than fair.
The publication cites an April 2022 BDO report. It was this company that audited the agreement and found the $376 million cost to be justified.
What’s more, the organization said the deal was conducted by “knowledgeable, unrelated parties”. Such a valuation goes against the position of the new management of FTX Trading.
As you may recall, the exchange filed a lawsuit to recover $323 million from Sam Bankman-Fried and former members of the European division’s top management team. That money was paid for DAAG in 2022, which was later renamed FTX Europe.
The company is also pushing to cancel the agreement, under which it owes another $52.5 million. The exchange’s claim states that DAAG was overvalued in the valuation and that the deal itself is a “whim” of Sam Bankman-Fried and his entourage.
This is how FTX commented on the BDO report:
“This report assumes that the purchase price reflected fair value because it was independent. Well, of course, you can’t claim that a fraudulent transaction is ‘transparent’ just based on the fact that it took place.”
The company noted that in fact Sam Bankman-Fried and his associates promised to pay $376 million for a “business-as-usual plan,” while the actual value of the enterprise is much lower.