FTX Loses $53,000 Per Hour Attributed to ‘Bankruptcy Fees’, Latest Filings Show

defunct crypto exchange FTX

In the three months ending Oct. 31, defunct crypto exchange FTX has incurred an expenditure of approximately $53,000 per hour on legal and advisory services, the latest round of compensation filings show.

Court documents spanning from December 5 to December 16 elucidate that the legal practitioners specializing in bankruptcy proceedings have invoiced a minimum of $118.1 million for services rendered between August 1 and October 31. This translates to an average daily charge of $1.3 million or an hourly rate of $53,300 throughout the 92 days.

The largest bill came from the management consulting firm Alvarez and Marshall, which invoiced $35.8 million for its consultancy services rendered over the aforementioned three-month duration.

defunct crypto exchange FTX
Alvarez and Marshall invoiced the FTX estate a cumulative sum of $35.8 million in fees (Source: CourtListener)

Coming in second place was global law firm Sullivan & Cromwell, which charged $31.8 million for its services. The average hourly rate for Sullivan & Cromwell’s services stood at $1,230 per hour.

defunct crypto exchange FTX

The global consulting firm AlixPartners invoiced $13.3 million during the specified period for professional services associated with forensic investigations. Concurrently, Quinn Emanuel Urquhart & Sullivan levied charges amounting to $10.4 million within the same timeframe. Additionally, aggregate billings from various smaller advisory firms totaled over $26.8 million.

Statistics disclosed by an anonymous FTX creditor in a post dated December 17 on X (formerly Twitter) propose that the comprehensive remuneration disbursed for legal services since the inception of the FTX bankruptcy case approximates $350 million.

Simultaneously, a preceding report submitted on December 5 by the court-designated fee examiner, Katherine Stadler, delineated “significant areas of concern” about the invoices presented by prominent advisory firms, encompassing Sullivan & Cromwell, Alvarez & Marshall, and others, during the period spanning from May 1 to June 31.

“The Fee Examiner identified top-heavy staffing, apparently excessive meeting attendance, fees related to non-working travel time, and various technical and procedural deficiencies concerning some time entries (including vague and lumped entries),” states the report regarding the billings submitted by Alvarez & Marshall.

defunct crypto exchange FTX
Advisory firms were criticized for over-billing by the cases’ Fee Examiner (Source: CourtListener)

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Chi Do
Chi Do
Chi Do is a content writer at CoinMinutes, responsible for creating most of the content on the website, including news related to Bitcoin (BTC), Ethereum (ETH), Blockchain, Decentralized Finance (DeFi), and more. With a keen interest in cryptocurrencies since the 2020s, Chi has acquired extensive experience and knowledge in this field. Chi holds a Bachelor's degree in communication from Academy of Journalism and Communication in Vietnam.

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