Article: Investigation Clears Sullivan & Cromwell of Wrongdoing in FTX Bankruptcy
An extensive investigation into Sullivan & Cromwell LLP, the legal firm that had worked closely with the now-defunct crypto exchange FTX, has found no evidence of its involvement in any fraudulent activities or its awareness of the financial difficulties that eventually led to the collapse of the trading platform.
The probe, led by former U.S. prosecutor Robert Cleary, has recently revealed that Sullivan & Cromwell LLP bears no responsibility for the FTX fraud or any misconduct associated with it. Reuters has reported that Cleary’s investigation found no indication that the law firm had overlooked any warning signs or “red flags” during their work with FTX, including the ill-fated Voyager Digital acquisition.
According to Cleary, while Sullivan & Cromwell did convey false information to third parties, they were genuinely unaware of the inaccuracies. One example mentioned in the probe was when Sullivan & Cromwell partner Andy Dietderich mistakenly believed FTX’s financial situation was stable, even though FTX’s founder, Sam Bankman-Fried, was actively seeking a buyer or investor for the company on the same day.
In response to Cleary’s findings, Sullivan & Cromwell issued a statement expressing confidence in their work for FTX and the initiation of Chapter 11 proceedings. The firm also welcomed the examiner’s report, which debunked various unfounded allegations made against their work for FTX.
The outcome of this investigation brings some relief to Sullivan & Cromwell as they are cleared of any wrongdoing in the FTX bankruptcy case.