DOJ Reconsiders Law Firm Selection for Binance Monitorship amid Conflict Concerns

The Department of Justice (DOJ) is facing a dilemma in selecting a law firm to oversee a critical assignment related to Binance, as reported by Bloomberg on Tuesday. The DOJ had initially chosen Sullivan & Cromwell, a prominent New York law firm, to act as an independent monitor for Binance as part of a plea agreement resolving money laundering and sanctions violations charges.

However, concerns have been raised regarding the law firm’s prior work for FTX, a rival exchange to Binance. Sullivan & Cromwell had been managing FTX’s bankruptcy proceedings and had submitted invoices exceeding $170 million for its services. In February, FTX investors filed a class-action lawsuit against the firm, alleging complicity in an $8 billion fraud.

The DOJ is now reconsidering its decision and evaluating alternative candidates for the monitorship role. FinCEN, the Treasury Department’s Financial Crimes Enforcement Network, is still in favor of appointing Sullivan & Cromwell despite the concerns raised by DOJ officials.

The law firm, the DOJ, and FinCEN have not yet responded to requests for comment on the matter. A US bankruptcy judge has authorized an investigation into potential conflicts of interest held by Sullivan & Cromwell regarding its work with FTX.

This development adds another layer of complexity to the ongoing oversight of Binance and raises questions about the integrity of the monitoring process. Stay tuned for further updates on this evolving story.