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Lies And Stolen Assets: FTX Debtors, Bahamas Regulators Hurl Allegations At Each Other

The back-and-forth between FTX's debtors and the Securities Commission of The Bahamas (SCB) is getting ugly.

The SCB claims that the debtors have made "material misstatements" in the press and court filings, and also refused to allow the court-supervised joint provisional liquidators access to FTX's AWS system.

This, the regulator argues, is impeding the investigation into the FTX collapse. 

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The SCB took possession of digital assets belonging to FTX and its principals on Nov. 12 and placed them in digital wallets under its control in order to safeguard them.

Meanwhile, FTX's Chapter 11 debtors have challenged the SCB's calculations of the assets in question. They have also alleged that the assets were stolen, while the SCB says it had acted under the authority of an order made by the Supreme Court of The Bahamas.

SCB clapped back by accusing the debtors of showing a "cavalier attitude towards the truth and towards The Bahamas."

Chapter 11 debtors had chosen not to utilize their ability to request information from the joint provisional liquidators, despite a court order allowing them to do so, the SCB claims.

The SCB went on to address previous statements made by the Chapter 11 debtors, including allegations that the SCB had instructed FTX employees to "mint a substantial amount of new tokens."

SCB claims that it seeks to safeguard the interests of customers and creditors of FTX and its affiliated entities.

It also urged the Chapter 11 debtors to cooperate fully with the investigation and to refrain from making public statements that were based on “incomplete or inaccurate information.”

According to court documents from December 2022, the FTX legal team claimed that the Bahamas government had asked former FTX CEO Sam Bankman-Fried to create a new cryptocurrency that would be under the control of local authorities.

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