A group of media companies wants to know who FTX owes money to after it goes bankrupt. Including non-US customers who lost their money after the dramatic crash. But why do news sources feel they need to know the personal details of creditor customers?
Several media companies have raised objections to a proposal by FTX to redact or withhold certain classified information for non-US clients. They have affirmed in the bankruptcy court that transparency and openness are fundamental principles in the insolvency proceeding.
Media entities involved here include such notable names as Bloomberg, Dow Jones & Company, The New York Times Company, and The Financial Times Ltd.
The companies’ May 4 filing in Delaware bankruptcy court makes a strong case for transparency. and for disclosure of FTX clients.
“United States law—constitutional and statutory—ensures the public a strong default right to examine bankruptcy filings. This right cannot be overridden by a party’s assertion of legal obligations under foreign law,” the plaintiffs say.
they have previously argued, in the April filing, stated that the names of FTX’s creditors did not constitute “confidential business information”. He also raised the point that disclosure of this information would not expose creditors to “undue risk”.
However, FTX and the Official Commission for Unsecured Creditors differ. They agree that making creditor and customer details public will open them up to identity theft or “unlawful injury”.
The Official Unsecured Creditors Committee represents the interests of all unsecured creditors in bankruptcy. It also investigates the debtor’s financial affairs, monitors the progress of the case, and makes its recommendations to the bankruptcy court.
Bankruptcy procedures adhere to a set of legal rules and principles that ensure fairness and transparency for all parties involved. However, balancing the need for privacy against the public’s right to access information in bankruptcy proceedings is difficult. Especially with so many creditors involved.
Hearing for May 17th
November 11th filing It is estimated that there may be more than a million creditors in total after the crash. FTX owes the 50 largest creditors more than $3.1 billion.
In this case, media prosecutors argue, disclosure of personal information to creditor clients is critical to understanding the full scope and impact of FTX’s bankruptcy. As the debtor in this situation, FTX has a legal obligation to provide complete information to all parties involved. Ultimately, the court will have to decide what is included.
A hearing to decide the matter will be held on May 17.
BeInCrypto has reached out to the Reporters Committee for Freedom of the Press, which represented the media in this filing. At the time of posting, there has been no response.
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