The Supreme Court has approved the appointment of joint provisional liquidators for Bahamas-headquartered FTX Digital Markets Ltd., according to a statement from the Securities Commission of The Bahamas, which said it has moved to further protect “the interests of clients, creditors, and other stakeholders globally” of the embattled company.
“On November 10, the Securities Commission of The Bahamas applied to the Supreme Court to appoint Mr. Brian Simms, KC, as a court supervised provisional liquidator,” SCB said in the statement.
“Further, on November 14, Kevin Cambridge and Peter Greaves, of PricewaterhouseCoopers, were approved by the court as joint provisional liquidators.
“Given the magnitude, urgency, and international implications of the unfolding events with regard to FTX, the commission recognized that it had to, and moved swiftly to use its regulatory powers under the Digital Assets and Registered Exchanges (DARE) Act to further protect the interests of clients, creditors, and other stakeholders globally of FTX Digital Markets Ltd.
“Over the coming days and weeks, the commission expects to engage with other supervisory authorities on a regulator-to-regulator basis as this event is multijurisdictional in nature.”
The statement continued: “The commission is the lead authority in The Bahamas conducting the investigations into the events and parties, including, but not limited to, FTX Digital Markets Ltd., FTX Trading Ltd., Alameda Research Ltd. and other related entities whose center of main interest, direction and management were purportedly located in The Bahamas.
“The investigations into these events are ongoing and the commission will extend its full assistance to the police if and when required.”
The police confirmed on Sunday that FTX was under investigation to determine “if any criminal misconduct occurred”.
“In light of the collapse of FTX globally and the provisional liquidation of FTX Digital Markets Ltd., a team of financial investigators from the Financial Crimes Investigation Branch are working closely with the Bahamas securities commission to investigate if any criminal misconduct occurred,” police said in a statement.
The commission said on Thursday that it became aware of public statements suggesting that FTX mishandled client assets and “mismanaged and/or transferred (assets) to Alameda Research”, which is FTX’s supposed “sister” company in the United States (US).
The commission added that any of those actions would have been in contravention of “normal governance” without the consent of the company’s clients and a “potentially unlawful” move.