Media Organizations Challenge Judge Dorsey’s Decision to Keep FTX Customer Names Confidential
The four major media outlets that have been advocating for the disclosure of FTX customer names have voiced their opposition to the decision to keep them sealed. However, a crypto lawyer informed Cointelegraph that “there is clear evidence” of potential damage that could be caused if the names were to be revealed.
On June 23, Reuters reported that Bloomberg, Dow Jones & Company, The New York Times, and the Financial Times have challenged Judge Dorsey’s ruling to keep the identities of FTX customers confidential.
On June 9, Dorsey made the decision to have FTX “irrevocably remove” the identities of individual customers from all court documents for the protection of the customers, noting that they are the “top priority in this matter.”
Legal representatives for the media organizations have reportedly contested this in a court filing on June 22, arguing that FTX should not be given a “novel and sweeping exception” to bankruptcy disclosure requirements solely due to the fact that its “customers utilized cryptocurrency”.
The media has maintained its stance that bankrupt companies are required to reveal the identities and amounts of debt owed to their creditors.
Despite this, Dorsey chose to keep the names confidential, saying that he wanted to make sure customers would not be taken advantage of by any fraudulent activities.
This is consistent with the provision in American bankruptcy law that guards against the possibility of harm caused by disclosure.
The media has previously voiced its objection to the names of FTX customers being kept confidential, having done so on May 3.
In the initial filing, it was contended that disclosing the names would not put creditors in “undue peril” and that the list does not constitute “confidential commercial data.”
FTX is attempting to reclaim $700M from Bankman-Fried associates and related funds.
Crypto Lawyer Approves of Judge Dorsey’s Decision to Protect FTX Customers
Irina Heaver, a crypto lawyer based in Dubai, expressed her approval of the judgement made by Dorsey which allowed FTX to keep their customers’ names private when speaking to Cointelegraph.
Heaver noted that this appeal by media organizations appears to disregard the distinct dangers that individuals would encounter if their identities were exposed.
Heaver used the “Celsius case” as an illustration, resulting in a sharp increase of phishing attempts in July 2022.
Celsius depositors received a warning email following the disclosure that certain customer data had been exposed as a result of an internal employee giving a list of emails to a malicious third-party.
Can crypto exchanges be trusted after the failure of FTX?
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