Tr?id=566623520170033&ev=PageView&noscript=1

Prager Metis Becomes First CPA Firm Involved With FTX Scam

Posted on December 5th, 2022 at 1:05 PM
Prager Metis Becomes First CPA Firm Involved With FTX Scam

From the Desk of Jim Eccleston at Eccleston Law.

Prager Metis becomes the first CPA firm to open a Metaverse headquarters in the metaverse platform Decentraland.

It also is the first CPA firm to become embroiled in the FTX scam.
Prager Metis and another accounting firm, Armanino LLP, were “willfully blind” to a pattern of “racketeering” at FTX, a client who allegedly lost $20,000 has alleged in a Nov. 23 lawsuit filed in San Francisco federal court, according to Bloomberg Tax. Industry experts anticipate that this suit is expected to be the first of many as regulators probe the company to assign liability for billions of dollars in missing funds.

The recent lawsuit implicates FTX’s bankruptcy filing, in which new CEO John J. Ray III noted that the company’s books were a mess. Ray, who helped manage Enron Corp.'s liquidation, detailed a significant lack of oversight at the company, including expense reports being approved by emoji as well as the absence of a human resources or accounting department.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here”, Ray said in a bankruptcy court submission.
Ray directly called out the auditors, citing “substantial concerns as to the information presented in these audited financial statements”, notably for the portion of the business audited by Prager Metis.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, ftx

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

I am so glad I found you! Wow! I appreciate your help, concern and guidance.

RB

LATEST NEWS AND ARTICLES

1785249991 Law
July 28, 2026
Merrill Lynch Fined by FINRA for Failing to Report More Than 1,600 Customer Complaints

Merrill Lynch has agreed to pay a $225,000 fine and accept a censure to resolve allegations that it failed to properly identify and report more than 1,600 customer complaints submitted through post-call surveys, according to a Financial Industry Regulatory Authority (FINRA) Acceptance, Waiver and Consent letter ("AWC").

1784905692 Law
July 24, 2026
Independent Review Recommends Sweeping Changes to FINRA's Enforcement Program

An independent review commissioned by the Financial Industry Regulatory Authority (FINRA) recommends significant changes to the regulator's enforcement program, including adopting a statute of limitations, expanding due process protections, and providing greater credit to firms that cooperate during investigations, according to AdvisorHub.

1784829196 Law
July 23, 2026
Cresset Sues Former Advisor Over Alleged Client Solicitation and Competing RIA Launch

Cresset Capital Management has filed a lawsuit in Illinois state court against a former advisor, alleging that he began building a competing registered investment advisory firm and soliciting clients while still employed by the Chicago-based wealth management firm.