[lazide]

It is not only not typical, it is definitely raising eyebrows from the clerks office to the judges.

Language in these filings is usually so dry that it makes the Sahara look like Tahiti.

The cleanup CEO is mad. And he’s seen some shit.

The financial equivalent of ‘somehow folks with PhDs mixed cleaning chemicals together for no apparent reason and gassed a bunch of kindergartners’.

[Animats]

What he's really saying is, these guys had no back office accounting operation.

Usually, in a bankruptcy of a financial enterprise, there's a general ledger of transactions to look at. Some may be fraudulent, hidden amongst the legit ones. FTX does not seem to have had that. Much of the history is missing.

So it will have to be reconstructed, often from the other side of the transaction. Banks will be asked (ordered) to provide their transaction history for all relevant accounts. There will be heavy analysis of the blockchain, which is less anonymous than many people in crypto think. Whatever records FTX has will be analyzed. People identified as having dealt with FTX will be subpoenaed for their records. Gradually, cells on spreadsheets saying "On DATE transferred AMOUNT denominated in COIN to UNKNOWN" will have UNKNOWN filled in. This is forensic accounting.

In bankruptcy, that happens in public. Over time, the PACER filings for the case will fill up with details of where the money went. Some will be trackable, some won't. A lot of effort will go into finding out where big amounts went. The numbers are big enough to justify the effort.

Then come clawbacks, arrest, trials, civil litigation... A huge pain for everyone involved, but if you screw up at the 10-digit level, it gets done.

[lazide]

Thanks, that is a good analysis. Considering the mix of (often bespoke) coins and tokens, seems like a sure bet that some legal minded forensic techies are going to be able to build careers off this too.

[that_guy_iain]

> The cleanup CEO is mad.

I think he is also laying the groundwork for "This is going to never be fully accurate or clear what happened."

[curiousllama]

I think this is it - he's looking for publicity as reputational CYA (which is a big part of his job).

If you take a look and go "I can do this" and can't, then you look sketchy. If you take a look and go "nobody will ever be able to do this completely, but I'll try" then you look like a hero.

[compiler-guy]

Not even necessarily a CYA, but setting expectations about what is possible and what isn't is important.

It's like a doctor evaluating a patient.

[styren]

On the other hand how could these guys have fucked up any more than they already did? I think it's clear that he's earnest and not trying to win points simply based on that fact... did they do anything right?

[lazide]

At least they weren’t building black market nuclear bombs?

[pjc50]

He's said as much in other parts of the filing. All sorts of accounts for subsidiaries that should exist apparently just can't be found.