The liquidators have already pulled NZ$955,618 in their own fees from this exchange. Good to see someone calling them out on it as no one who had tokens lost on the exchange have been compensated yet.
GNY Issues Notice to Grant Thornton Over Cryptopia Liquidationhttps://www.gny.io/post/gny-issues-notice-to-grant-thornton-over-cryptopia-liquidationOn 14 January 2019, GNY lost over 15 million LML tokens on the Cryptopia Limited crypto currency exchange in New Zealand following a hack on the exchange. The tokens were stolen from what was described as a secure server run and managed by Cryptopia. The hack resulted in the crash of the price of LML tokens listed elsewhere, losing over 95% of its market value. The stolen tokens, now in decentralised exchanges in unknown jurisdictions, are beyond recovery.
On 15 May 2019, Cryptopia went into liquidation. David Ruscoe and Malcolm Moore, of Grant Thornton New Zealand, were appointed as liquidators.
On 21 July 2020 GNY issued a notice to the liquidators under sections 285 and 286 of the Companies Act 1993 alleging that they have failed to comply with one or more of their duties.
In the notice GNY alleges that:
· The liquidators have failed to accept or reject GNY’s claim despite having all the information requested from GNY.
· The liquidators did not accurately describe GNY’s claim to the Court. Nor have they reflected GNY’s claim in their liquidation reports.
· The liquidators have failed to investigate the Hack and how the company’s security systems failed. GNY considers this investigation should be separate from the police investigation underway which seeks to determine criminal liability.
· The liquidators’ recent liquidator report fails to adequately explain the work they have undertaken for their fees. Over the 15 November 2019 to 14 May 2020 period, the liquidators have incurred NZ$955,618 in fees.
GNY is concerned that the total of the liquidators’ fees and other expenses in the liquidation have consumed more than half of the receipts in the liquidation to date. These costs continue to mount at the expense of creditors (like GNY) whose claims have not been accepted or engaged with, in GNY’s view, adequately. The liquidators have paid themselves over NZ$1.7m in this liquidation.
GNY have concerns about the liquidators’ handling of this liquidation, and consider the process to have been deeply flawed as set out in the notice. It is for this reason that GNY has issued a notice of failure to comply. As things stand, any final report from Grant Thornton, will almost inevitably give grounds for appeal. The liquidators have 5 business days to respond to GNY’s notice.
Full copy of the legal notice:
https://download-files.wix.com/_api/download/file?downloadToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpc3MiOiJ1cm46YXBwOmU2NjYzMGU3MTRmMDQ5MGFhZWExZjE0OWIzYjY5ZTMyIiwic3ViIjoidXJuOmFwcDplNjY2MzBlNzE0ZjA0OTBhYWVhMWYxNDliM2I2OWUzMiIsImF1ZCI6WyJ1cm46c2VydmljZTpmaWxlLmRvd25sb2FkIl0sImlhdCI6MTU5NTMzNDQ4NCwiZXhwIjoxNTk1MzcwNDk0LCJqdGkiOiI0NzExNDVlMTgzODAiLCJwYXlsb2FkIjp7InBhdGgiOiIvdWdkL2NkZGYzMl80ZDZhODczODY4NTc0ODhiYTIzZjNiOGNiYzRkMzU1OC5wZGYiLCJhdHRhY2htZW50Ijp7ImZpbGVuYW1lIjoiQ2hhcG1hbiBUcmlwcCBsZXR0ZXIgMjEgSnVseSAyMDIwLnBkZiJ9fX0.k1mZTA5FHb0beOhqdRC8k53E0uAeqyh-DXj55JiaVDc
