FTX: U.S. trustee objects to committee’s choice of financial adviser

By Sarah Lizee

Olympia, Wash., Feb. 9 – The U.S. trustee overseeing FTX Trading Ltd.’s bankruptcy case objected to an application by the official committee of unsecured creditors to retain FTI Consulting, Inc. as financial adviser, according to documents filed Thursday with the U.S. Bankruptcy Court for the District of Delaware.

FTI is employed as the financial adviser to the official committee of unsecured creditors in the Chapter 11 cases of Voyager Digital Holdings, Inc.

FTX debtor Alameda Research Ltd. recently sued Voyager to recover $445.8 million in preferential transfers.

The $445.8 million sum is significant to the general unsecured creditors in both the FTX and Voyager estates, as both cases involve no material secured debt. The outcome of the suit will have a direct and substantial effect on the recoveries for general unsecured creditors of both estates.

“Because FTI represents the fiduciary body protecting general unsecured creditors of Voyager, a defendant in the preference adversary, FTI represents an interest adverse to Alameda’s estate,” Regions 3 and 9 U.S. trustee Andrew R. Vara said in his objection.

“The estates of the Voyager debtors have an interest in eliminating and/or minimizing the same claim that the estates of the FTX debtors have an interest in maximizing.”

The U.S. trustee said bankruptcy code does not permit FTI to serve the fiduciary bodies for both bankruptcy estates simultaneously in connection with their respective bankruptcy cases.

FTX has headquarters in the Bahamas. The company filed Chapter 11 bankruptcy on Nov. 11 under case number 22-11068.

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