Sam Bankman-Fried’s new petition for indemnifying his legal costs has come under fire from lawyers representing the crypto exchange and its creditors’ unit, as stated by Cointelegraph.
According to Cointelegraph, on March 15, 2023, Bankman-Fried’s lawyers submitted the motion to get his court expenses reimbursed by directors and officers (D&O) insurance schemes. “It would be unfair, inequitable, and contrary to the interests of justice to allow Mr. Bankman-Fried to drain the D&O Policies for his sole benefit,” FTX’s lawyers mentioned in a March 29, 2023, objection filing.
Based on information by Cointelegraph, FTX’s lawyers made the argument that if court agrees with Bankman-Fried’s motion then insurance payout should be applicable for directors and supporters who can claim the funds. Reportedly, the Official Committee of Unsecured Creditors also submitted an objection, emphasising that D&O insurance policies are applicable only “where they make honest decisions in the ordinary course of the business,” which it argues “is not the case” regarding Bankman-Fried’s request.
Moreover, the committee highlighted that the court should disagree with the motion, based on Bankman-Fried being the “alleged perpetrator of one of the largest criminal frauds in the last decade.”
(With insights from Cointelegraph)