FTX Auditor Pays $1.95 Million to Settle SEC Charges of Audit Misconduct

FTX Auditor Settles with SEC for $1.95 Million

Prager Metis CPAs, the accounting firm that audited bankrupt cryptocurrency exchange FTX, has reached a settlement with the Securities and Exchange Commission (SEC) for $1.95 million. The settlement resolves allegations of audit negligence and violations of auditor independence rules during Prager Metis’s audits of FTX.

The SEC’s complaint, filed in December 2022, accused Prager Metis of failing to adequately examine FTX’s financial statements and internal controls. The complaint also alleged that the firm violated auditor independence rules by failing to disclose conflicts of interest.

The settlement, which does not constitute an admission of wrongdoing by Prager Metis, requires the firm to pay a civil penalty of $1.95 million. It also prohibits Prager Metis from auditing public companies for two years.

This case highlights the importance of strong audit practices and adherence to independence rules in the cryptocurrency industry. It also serves as a reminder that auditors can be held accountable for their actions.