An independent auditor has confirmed that fees charged by lawyers and restructuring teams working on the bankrupt cryptocurrency exchange, FTX, have reached over $200 million in just over seven months. While the fees may seem excessive, the auditor explained that the legal proceedings are “on track to be very expensive” due to the complexities of the case.
The FTX bankruptcy is considered remarkable because it operates in a largely unregulated financial system, lacks basic corporate governance, and has no corporate records. Despite the high fees charged, the auditor praised the performance of the FTX restructuring team, acknowledging that few firms could have accomplished what they did in such a short period.
The breakdown of the fees charged revealed hourly rates for the 242 lawyers on the case ranged from $388 to $2,165, with some lawyers charging over $2,000 per hour. New York-based law firm Sullivan & Cromwell received the biggest paycheck, having charged around $42 million in fees and expenses.
Overall, the auditor advised careful stewardship of administrative expenses, which would result in a better outcome for creditors and a cost-conscious Chapter 11 process.