Prager Metis Hit With FTX-related Lawsuit

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  • An accounting firm with a headquarters in the metaverse, Prager Metis, has been blamed for its role in the FTX saga
  • The firm was sued together with another FTX US auditor
  • The complainant claims to have lost roughly $20,000 due to the FTX collapse

An accounting firm that boasts of having its headquarters in the metaverse, Prager Metis, has been taken to court for its role in the FTX collapse. According to an FTX investor who claims to have lost roughly $20,000, Prager Metis endorsed the crypto exchange’s financial situation despite being aware of the big financial hole in its books. The lawsuit adds to other lawsuits filed against the exchange and its top executives.

The Certified Financial Information Couldn’t be Trusted

According to Bloomberg, Stephen Pierce holds that the FTX saga cost him $20,000 which could have been avoided if the accounting firm didn’t endorse FTX’s dilapidated financial situation. Pierce also accuses Armanino LLP, another accounting firm, of being part of the conspiracy to hide the rotten state of affairs at FTX. 

Filed in the US District Court of the Northern District of California, the lawsuit hinges on revelations that the “financial information” signed by the accounting firms couldn’t be trusted. Pierce claims that the two firms released certified copies of financial reports in March showing that everything was okay with the Sam Bankman-Fried-led exchange, making them part of the reason why investors lost billions of dollars in FTX.  

From SBF to Celebrities, Partners and Auditors, Everyone is Guilty

The lawsuit further disclosed that Prager Metis failed to activate “professional skepticism” when dealing with the exchange as required by financial watchdogs. This is the latest FTX lawsuit after the first lawsuit targeted Bankman-Fried and the celebrities who prompted the exchange. 

This lawsuit is the latest to his FTX, with two already having been filed targeting Alameda Research CEO Caroline Ellison, Bankman-Fried and NBA team Golden State Warriors for promoting FTX. As the FTX story continues to unfold, more lawsuits are likely to land in federal courts.