The U.S. Federal Trade Commission (FTC), in a bankruptcy court filing, stated that it is investigating Voyager Digital’s marketing scheme.
The complaint states that the FTC has initiated an investigation into the acts and practices of Voyager and the debtors’ directors, employees, and officers for deceptive and unfairly marketing cryptocurrency to the public.
According to the FTC filing, the sale of assets by the debtor would be disruptive to the current probe. This could effectively discharge Voyager or specific staff members from fraud-related debts that were held by a government unit.
Voyager is being investigated by more than one government agency, including the FTC. Texas’s attorney general and securities regulator objected to FTX buying Voyager before FTX collapsed.
Binance US was opposed by the Securities and Exchange Commission (SEC). Voyager was granted court approval to continue with the sale despite the objection.
Allyson Smith, Kirkland & Ellis’s lawyer, stated to the court that Voyager is ‘on track’ for the sale. Voyager’s lawyer stated that the sale is on track and didn’t anticipate any obstacles. The FTC has filed a new filing stating that the debtors ‘don’t have the right to any discharge here.
“Further,” the FTC objection states, “Even if debtors had the right to discharge (through operation consensual release, for instance), the code specifically precludes discharge of fraud-related debts owned by a government unit.”
“Therefore, the FTC respectfully requests that the court deny confirmation to the debtors’ proposed plan; strike Section VIII.B. and D of their proposed plan; or grant any other relief that the Court considers appropriate and just.
