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PWC, one of the \u2018Big Four\u2019 auditors and among the largest professional services networks globally, recently published a report on FTX Digital Markets, the bankrupt crypto exchange\u2019s Bahamian subsidiary. The report indicates that the entity\u2019s accounting records have been limited, and it also noted that there is \u201clittle distinction between what represents potentially client monies and corporate funds.\u201d<\/strong><\/p>\n In mid-November 2022, following the Chapter 11 bankruptcy filing by the exchange FTX and its large number of subsidiaries, The Bahamas\u2019 regulator appointed<\/a> Kevin Cambridge and Peter Greaves from PWC as the joint provisional FTX liquidators in the proceedings. PWC has recently published a report<\/a> that shows the crypto exchange\u2019s Bahamian entity FTX Digital Markets reportedly commingled client funds.<\/p>\n FTX Digital Markets essentially held \u201climited accounting records,\u201d and the PWC auditors noted that there \u201cappears to have been little distinction between what represents potentially client monies and corporate funds.\u201d Additionally, along with the alleged commingling of funds, data was reportedly commingled as well between the company\u2019s wider affiliates \u201cwith little or no segregation applied.\u201d<\/p>\n The auditors discovered $219.5 million in cash held at various banks, and requests have been made to the financial institutions to retrieve the funds. PWC also discussed the various properties purchased in The Bahamas by FTX executives, and it further noted that FTX Digital also owns about $3 million in ancillary assets. In addition to the assets discovered, a significant portion of the crypto assets is not under the joint provisional FTX liquidators\u2019 control due to the $323 million hack stemming from FTX International.<\/p>\n \u201cThe [joint provisional liquidators] have requested the transfer of $46.7 million in [tether] from an account in the name of FTX Digital, and they are waiting for the transfer of these assets to their custody,\u201d the report from the PWC auditors further discloses. The report also calls for further investigations into the company\u2019s \u201ccash management,\u201d \u201cantecedent transactions,\u201d and \u201ccustomer migration.\u201d FTX\u2019s joint provisional liquidators say they continue to employ about 16 individuals for ongoing investigations and research into the \u201cpossibility of restructuring the business.\u201d<\/p>\nFTX Joint Provisional Liquidators Continue Investigations Into Bahamian Subsidiary<\/h2>\n