Law Firm Dismisses Accusations of Aiding FTX's Fraudulent Acts
Fenwick & West law firm denies assisting FTX's alleged fraud; they stress their limited advisory role amid broader legal accusations.
Sun, 24 Sep 2023, 23:06 pm UTC
The renowned U.S. law firm, Fenwick & West, has responded to a lawsuit that accuses it of assisting in the illegal activities of a now non-operational cryptocurrency exchange, FTX. The firm firmly denies any wrongdoing.
Court documents from September 21 reveal Fenwick & West's stance on the matter. They argue that a lawyer's actions, as long as they are within the boundaries of representing their client, should not be seen as collusion or aiding in the client’s unlawful actions.
Those pursuing the lawsuit against Fenwick & West argue that Sam Bankman-Fried, while associated with FTX, took advantage of the legal advice given by the firm to further his deceitful practices. These accusers go a step further, suggesting that Fenwick & West's services to FTX were not typical for a law firm. Their claim insinuates that Fenwick & West provided services that stretched beyond standard legal aid. The court documents even note allegations that some Fenwick staff left the firm to join FTX on their own accord.
Another aspect of the case revolves around accusations that Fenwick & West played a part in setting up companies that Bankman-Fried used for dishonest purposes. The firm also supposedly guided FTX through the complex regulations of the rapidly changing cryptocurrency industry.
In defense, Fenwick & West states that they weren't the only legal counsel for FTX, emphasizing their limited role in advising the cryptocurrency exchange. They believe that if their actions could be seen as a basis for legal claims, then any legal practitioner could potentially be taken to court due to a client's indiscretions. This, they stress, isn't how the legal system works.
Interestingly, this lawsuit emerges after FTX's debtors filed charges against the former staff of Salameda, a company once linked to FTX. This follows FTX's own legal pursuit to recover $157.3 million they believe was unlawfully taken just before they declared bankruptcy.
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