The United States Securities and Exchange Commission (SEC) has taken legal action against Prager Metis, the auditor of the now-bankrupt cryptocurrency exchange FTX. The SEC has accused Prager Metis of failing to maintain the required independence while providing auditing services to its clients, breaching federal securities laws. This includes adding indemnification provisions to engagement letters for more than 200 audits, reviews, and exams conducted between December 2017 and December 2020.Furthermore, Prager Metis is accused of failing to notify its clients about these violations, despite being informed by the Public Company Accounting Oversight Board (PCAOB) that these indemnification provisions breached independence requirements. This lack of transparency and ethical concerns raise questions about auditing practices in the cryptocurrency industry.The SEC’s legal action against Prager Metis highlights the importance of auditor independence in maintaining the integrity of financial reporting and public trust. The outcome of these legal proceedings will determine the extent of accountability and potential consequences for Prager Metis. Additionally, it underscores the need for strict adherence to auditor independence rules and greater transparency in the financial auditing industry. As this case unfolds, the implications for the cryptocurrency industry and the auditing firms that serve it will be closely monitored. Auditor independence remains a cornerstone of trust in financial markets, and any violations must be addressed to maintain investor confidence.

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Information	Details
Geography	North America
Countries
Sentiment	negative
Relevance Score	10
People	SEC, Prager Metis, Ron Wyden, PCAOB, Elizabeth Warren
Companies	SEC, Ron Wyden, Public Company Accounting Oversight Board (PCAOB), FTX, Elizabeth Warren
Currencies	None
Securities	None