en.wikipedia.org/wiki/Bankruptcy_of_FTX
2 corrections found
Following the bankruptcy, the Securities Commission of the Bahamas froze the assets of one of FTX's subsidiaries.
This reverses the timeline. The Bahamian regulator froze FTX Digital Markets’ assets on November 10, 2022, while FTX’s Chapter 11 petitions were filed on November 11, 2022.
Full reasoning
The sentence says the Bahamas asset freeze happened after the bankruptcy, but the cited events occurred in the opposite order.
- A reproduction of the Securities Commission of The Bahamas' official statement says: "Thursday 10 November 2022 - Today, the Securities Commission of The Bahamas ... took action to freeze assets of FTX Digital Markets and related parties."
- An FTX press release states that the Delaware bankruptcy court's "First Day" motions were related to the FTX debtors' "Chapter 11 petitions filed on November 11, 2022."
So the asset freeze took place on November 10, 2022, and the Chapter 11 filings came on November 11, 2022. That means the article's chronology is incorrect: the freeze preceded the bankruptcy filing, rather than following it.
2 sources
- Securities Commission Of The Bahamas Freezes Assets Of FTX - Financial Services - Bahamas
Nassau, The Bahamas, Thursday 10 November 2022 - Today, the Securities Commission of The Bahamas (the Commission) took action to freeze assets of FTX Digital Markets and related parties.
- FTX Receives Court Approval for "First Day" Motions
...the "First Day" motions related to the FTX Debtors' Chapter 11 petitions filed on November 11, 2022.
collapsed after being closed by the New York State Department of Financial Services after being designated a systemic risk following a run.
This gets the sequence wrong. NYDFS says it closed Signature because the bank could not provide a credible liquidity plan; the federal systemic-risk exception was announced afterward, once the bank had already been closed.
Full reasoning
The sentence says Signature Bank was closed by New York regulators after being designated a systemic risk following a run. Official statements show the order was the other way around.
- On March 12, 2023, NYDFS said it "has taken possession of Signature Bank ... in order to protect depositors."
- In its later review, NYDFS said "The bank's inability to provide a credible liquidity plan to open on Monday, March 13, led DFS to take possession of the bank on Sunday, March 12, 2023."
- The federal joint statement issued that same day said: "We are also announcing a similar systemic risk exception for Signature Bank ... which was closed today by its state chartering authority."
That means Signature was first closed by NYDFS, and the systemic-risk exception was then announced for the already-closed bank. The article reverses the chronology and implies the systemic-risk designation was the reason NYDFS closed it.
3 sources
- Superintendent Adrienne A. Harris Announces New York Department of Financial Services Takes Possession of Signature Bank | Department of Financial Services
March 12, 2023 ... the New York Department of Financial Services (DFS) has taken possession of Signature Bank ... in order to protect depositors.
- New York State Department of Financial Services Announces the Results from the Review of the Supervision and Closure of Signature Bank | Department of Financial Services
The bank's inability to provide a credible liquidity plan to open on Monday, March 13, led DFS to take possession of the bank on Sunday, March 12, 2023.
- Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC | FDIC.gov
We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority.