Cryptocurrency lending company Celsius failed to accurately record transactions between its affiliates, leaving it difficult to fully determine intercompany claims, according to court documents filed on Thursday.
The documents were filed in response to a court order requesting information on potential claims against its affiliates, following the company's bankruptcy filing in July 2022.
Coindesk reported that the claim held by Celsius Network LLC against Celsius Network Ltd. was valued at approximately $9.1 billion based on books and records. This figure did not account for the "shortfalls in record keeping" that occurred in the three months before the bankruptcy filing.
See Also: Berkshire Hathaway's Charlie Munger Calls Cryptocurrency 'Worthless,' 'Antisocial'
An estimated 7,000 transactions were not reflected, or recorded, in the company's accounting books, and the lack of record-keeping made it challenging to reconstruct the intercompany claim.
Celsius presented a sale plan to the court earlier this week as part of its reorganization efforts.
The documents filed on Thursday reflect the state of the company's books as of the bankruptcy petition date.
The lack of accurate record-keeping means that it may not be possible to fully determine the intercompany claim. If it were possible, the process would be costly and time-intensive, and would likely require the engagement of a forensic accounting firm.
After conducting extensive analysis, Celsius estimated the full claim held by the LLC against CNL to be $3.5 billion.
Next: Shocking Bank Records Reveal Binance's $400M Transfer To Changpeng Zhao-Affiliated Trading Firm
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.