A Canadian law firm representing defunct cryptocurrency exchange lenders QuadrigaCX hired consulting firm Kroll to promote $ 190 million in compensation from user shares in early 2019.
QuadrigaCX is reportedly gripped by controversy after the death of its founder Gerald Cotten in December 2018, and he is allegedly the only person who had access to the stock exchange’s cold portfolio stocks.
In the September 8 announcement to Lenders, Miller-Thompson said Kroll will work in partnership with its strategic partner Coinfirm, who specializes in blockchain forensics and anti-money laundering compliance.
Coinfirm is a blockchain analytics engine developer designed to track crypto assets, fraud research, data analysis, and asset recovery.
According to the Miller Thomson update, Kroll and Confirm will have to analyze a subset of the transaction data. Regarding the sensitive nature of these transactions and the ongoing involvement of law enforcement agencies, the announcement states that no further details of Kroll’s involvement will be made public.
Kroll’s equity is $ 50,000, and the company’s non-contractual compensation amounts to $ 150,000. Obligations were set out by Miller Thomson, QuadrigaCX Inspectors, and the official designated committee of affected users.
Miller Thomson’s update also reveals that he sent information about the controversial payment processor Crypto Capital from Panama, which provided services to QuadrigaCX before the stock market crash, to Quadriga Ernst & Young’s screen.
“There is currently insufficient evidence to prove that Crypto Capital owes Quadriga funds since the date of bankruptcy,” Miller-Thompson said. However, should there be any new information on the case, Ernst & Young will “review available recovery methods for Quadriga’s property.”
Finally, the announcement indicates that the creditors’ compensation will likely remain a long process. “The most significant impact on the size of the allocation will be the review of Quadriga’s tax liabilities by the Canada Revenue Agency,” said Miller-Thompson.
The TRA has reportedly refused to confirm the timing of the audit, given irregularities caused by the coronavirus pandemic.