FTC Launches Investigation into Voyager's Alleged Deceptive Crypto Marketing Tactics – Here's the Latest
The Federal Trade Commission (FTC) has announced that it is investigating the bankrupt crypto lender Voyager Digital for “deceptive and unfair marketing of cryptocurrency to the public.”
The announcement of the investigation came in a filing with the US Bankruptcy Court for the Southern District of New York, where the FTC officially objected to a restructuring plan that had initially been approved by the judge in the case.
The proposed restructuring plan, which the FTC now has objected to, would mean that Voyager is not held accountable for “actual fraud, willful misconduct, or gross negligence,” the agency said in the document.
The FTC further noted in the filing that some of the parties involved in the bankruptcy proceedings should not be exempt from claims, and said this includes “debts for ‘false representation,’ and ‘false pretenses’.”
This “violates the Bankruptcy Code and relevant case law,” the agency wrote.
Not the first time regulators object
The announcement by the FTC is not the first time US regulators have caused problems for Voyager after it filed for bankruptcy. In January this year, the Securities and Exchange Commission (SEC) filed an objection over a move by Binance.US to buy up assets from the bankrupt crypto lender.
The objection came after Binance.US announced the takeover of distressed assets from Voyager Digital in a deal that valued the bankrupt company at about $1bn. Under the deal, Binance.US was to make a deposit of $10m, and reimburse Voyager for certain expenses up to $15 million.
The Binance.US plan followed a similar plan by FTX US to buy up assets, but that plan fell through when FTX went bankrupt. Voyager then reopened the bidding process for the company, which Binance.US eventually won.
Voyager Digital filed for bankruptcy under Chapter 11 of the US Bankruptcy Code in July of 2022, saying at the time that it would seek to implement a reorganization plan and "maximize value for all stakeholders."