FTX Spends Approximately $53,000 Per Hour on Legal and Advisory Fees in Bankruptcy Proceedings
During the three months ending October 31, the troubled crypto exchange FTX spent about $53,000 per hour on lawyer and bankruptcy specialist fees. The latest filings reveal that legal and advisory fees amount to over $118.1 million for the period from August 1 to October 31, averaging $1.3 million per day.
The management consultancy firm Alvarez and Marshall billed the highest amount, with $35.8 million for their services over three months. Global law firm Sullivan & Cromwell came in second with fees of $31.8 million, averaging $1,230 per hour.
Critical Examination of the Billing
The fee examiner identified seemingly excessive staffing, apparently excessive meeting participation, fees for unproductive travel time, and various technical and procedural deficiencies regarding certain time entries (including vague and lumped entries).
A recent report by the court-appointed fee examiner, Katherine Stadler, identified “significant areas of concern” in the billing submitted by these major consulting firms. The report highlights issues such as excessive staffing, excessive meeting participation, fees for unproductive travel, as well as technical and procedural deficiencies regarding certain time entries.
While the value of assets held by FTX increases with a bullish market, the expenses in the proceedings continue to eat away at what is rightfully owed to the platform’s users in the bankruptcy.
