Former FTX Attorney Alleges Fraud by Major NYC Lawfirm

Submitted by C Costigan on

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C Costigan

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Former FTX Attorney Alleges Fraud by Major NYC Lawfirm

Daniel Friedberg, the former chief regulatory officer of collapsed cryptocurrency exchange FTX until he resigned on Nov. 8, alleges that the company’s U.S. general counsel of had been channeling business to Sullivan & Cromwell (S&C).

He further claims that FTX US lead counsel Ryne Miller, who is a former partner at S&C, channeled business towards his former law firm across numerous cases. Friedberg stated:

“Mr. Miller informed me that it was very important for him personally to channel a lot of business to S&C as he wanted to return there as a partner after his stint at the Debtors.”

The implications of such a relationship are quite serious.

Lawyer and former chief of the Securities and Exchange Commission Office of Internet Enforcement, John Reed Stark, tweeted:

"Tomorrow is a hearing before FTX Bankruptcy Judge John Dorsey re the engagement of Sullivan & Cromwell. If this declaration is true, I cannot imagine any circumstance where the FTX Trustee would be allowed to engage Sullivan & Cromwell for any purpose."

Sullivan & Cromwell is a New York City-based multinational law known as a white-shoe firm.  The founder of Gambling911.com even worked there at one point in his other life.

Friedberg is notorious for once having been providing legal representation during a high profile insider cheating scandal at an online poker site.  A damning three-hour long audio would later surface that purports to feature Friedberg and a discussion on how to avoid paying affected customers.

From PokerFuse:

The men discuss both the specifics of the cheating and proposed ways for covering it up, refunding some affected players, and otherwise minimizing the impact of the cheating. Hamilton, Pierson and the attorneys also discussed ways to not issue refunds to some of the players, if reasons could be found to not pay them.

CoinGeek's Steven Stradbrooke claims Friedberg more recently has ties to a fake electronics website involved in convoluted financial workarounds with FTX customer deposits.

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