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The U.S. unit of cryptocurrency exchange Binance has halted withdrawal of dollars by its clients from the platform, its updated terms showed on Monday, Reuters reported. In early June, Binance.US had halted dollar deposits, after the U.S. Securities and Exchange Commission (SEC) asked a court to freeze its assets. "In the event that customers wish to withdraw U.S. dollar funds from their account, they may do so by converting U.S. dollar funds to stablecoin or other digital assets, which can subsequently be withdrawn," the terms page said. The SEC had sued Binance, its CEO and founder Changpeng Zhao, and Binance.US's operation in June, alleging in 13 charges that Binance had engaged in a "web of deception," artificially inflated trading volumes and diverted customer funds.

Another former member of Sam Bankman-Fried’s inner circle at FTX told a jury Monday that he committed crimes alongside the 31-year-old crypto entrepreneur, saying he was aware FTX customer money had been routed to Bankman-Fried’s crypto trading firm, YahooFinance.com reported. "I defrauded customers, investors," said Nishad Singh, the former director of engineering at the now-bankrupt cryptocurrency exchange, who first met Bankman-Fried while he was in high school. Singh pleaded guilty in February to wire fraud and conspiring to violate U.S. campaign finance laws. He is one of three close colleagues of Bankman-Fried to plead guilty and testify against the former FTX founder. The others — Caroline Ellison and Gary Wang — appeared during the first two weeks of the trial. Still another high-ranking FTX insider, software developer Adam Yedidia, testified against Bankman-Fried last week. Prosecutors are arguing that Bankman-Fried committed wire fraud and six other crimes by embezzling billions in FTX customer funds and lying to investors and lenders.

The U.S. Supreme Court agreed to hear a case in which an insurance company is challenging a bankruptcy reorganization plan that it says doesn’t protect it against fraudulent claims tied to asbestos exposure, WSJ Pro Bankruptcy reported. Truck Insurance Exchange is seeking to overturn a ruling by a U.S. appeals court that rejected the insurer’s challenge and allowed the bankruptcy reorganization plan of defunct cement maker Kaiser Gypsum to go forward. The insurer’s opposition centered on arguments that the Kaiser Gypsum bankruptcy plan would allow asbestos injury plaintiffs to pursue fraudulent claims against its policies. Insurance companies have made similar arguments in bankruptcy cases of the Boy Scouts of America and some Catholic dioceses involving sexual-abuse claims. Insurers have appealed the Boy Scouts of America’s bankruptcy settlement, and are challenging the plan put forward by the Diocese of Camden in New Jersey over similar issues.

The Boy Scouts of America has turned over a trove of records that survivors of sexual abuse and their lawyers have long sought from the youth group, which emerged earlier this year from bankruptcy with a plan to pay roughly $2.4 billion to resolve more than 82,000 individual abuse claims, WSJ Pro Bankruptcy reported. The youth group last week provided the majority of the more than 7,766 records regarding so-called ineligible volunteers, maintained to keep sexual abusers out of its ranks, to a settlement trust that helps distribute payments to survivors. Most of the files haven’t previously been made available to claimants and their lawyers. “There are over 6,300 new ineligible volunteer files that I just got access to,” said Chris Hurley, a member of the settlement trustee’s advisory committee and a lawyer for sexual-abuse survivors associated with the Boy Scouts. Access to the records could strengthen victims’ cases against alleged perpetrators and help survivors decide whether to pursue independent reviews of their claims, which would cost them $20,000 each but potentially result in more compensation than other settlement options.

Caroline Ellison, a top adviser to the cryptocurrency mogul Sam Bankman-Fried, testified on Wednesday that she had lied over and over at his request, misleading the public about his businesses and circulating “dishonest” financial documents to crypto lenders, the New York Times reported. By the time Mr. Bankman-Fried’s two companies — FTX, a digital currency exchange, and Alameda Research, a hedge fund — collapsed in November, the lies had become too much to bear, Ms. Ellison said, and the implosions were almost cathartic. “Overall it was the worst week of my life,” said Ms. Ellison, 28, fighting back tears as she recounted the frantic week when the companies failed. “I felt this sense of relief that I didn’t have to lie anymore, and that I could start taking responsibility even though I felt indescribably bad.” Ms. Ellison’s testimony, in her second day on the witness stand, was the most emotional moment so far of Mr. Bankman-Fried’s fraud trial. She was widely considered the government’s star witness, partly because she dated Mr. Bankman-Fried on and off for years, giving her unique access to the FTX founder as his crypto empire grew. His trial in federal court in Manhattan has become a referendum on high-risk practices across the crypto industry that led to billions of dollars in losses last year.

Mallinckrodt, one of the largest manufacturers of prescription opioids in the U.S., received court approval for a plan that wipes out more than $1 billion of payments meant for addicts while handing control of the pharmaceutical company to its lenders, WSJ Pro Bankruptcy reported. The U.S. Bankruptcy Court for the District of Delaware yesterday approved the plan that would pave the way for the company to exit from bankruptcy, less than a couple of months after it filed for chapter 11 protection. Mallinckrodt executives have said the company reached a restructuring deal after extensive outreach from its creditors, who, the executives said, believed the drugmaker carried too much debt and needed to right-size its finances to stay in business. This is a setback to governments and individual addicts who filed lawsuits seeking compensation from drugmakers for their role in the opioid crisis. The legal fight stretches back nearly a decade, when more than 3,000 lawsuits from states, Native American tribes and counties alleged the drugmakers, pharmacies and distributors played down the risks of the painkillers and didn’t stem their flow. A few opioid manufacturers that lacked the funds to settle those thousands of lawsuits turned to bankruptcy to try to resolve them. Dublin-based Mallinckrodt, for instance, agreed to pay $1.7 billion into a trust for addicts over eight years to resolve thousands of lawsuits over its alleged role in fueling the opioid crisis. As part of that deal, negotiated during Mallinckrodt’s first bankruptcy filed in 2020, addicts permanently surrendered their legal rights to pursue opioid-related litigation against the company, and the drugmaker was allowed to keep manufacturing the drugs. Mallinckrodt this August filed for bankruptcy again to restructure its debts and outstanding obligations, including more than $1 billion still owed to the opioid victims’ trust.

Three days into Sam Bankman-Fried’s criminal trial in Federal District Court in Manhattan, Judge Lewis A. Kaplan’s warnings to the defense had become unmistakable, the New York Times reported. Judge Kaplan, who is presiding over the high-profile white-collar fraud case, repeatedly told Mr. Bankman-Fried’s lawyers to stop repeating themselves. Over and over, he directed them to rephrase their questions. And with his frequent interruptions of their cross-examinations, Judge Kaplan kept Mr. Bankman-Fried’s legal team off balance, putting it on the defensive. “I just want to express my growing concern about the extent of the entirely unnecessary repetition, and I’ve given you a lot of latitude,” Judge Kaplan told one of Mr. Bankman-Fried’s lawyers, Christian Everdell, during a brief break on Thursday when the jury was not in the courtroom. “You’re wearing out the welcome on the repetition.” Judge Kaplan is a veteran jurist with a history of presiding over prominent trials like that of Bankman-Fried, who is charged with orchestrating a scheme to misappropriate as much as $10 billion that customers deposited with his crypto exchange, FTX. While he is known for his no-nonsense attitude in the courtroom, legal experts say that Judge Kaplan is keeping the defense on an unusually short leash. Bankman-Fried’s trial resumed on Tuesday, with two crucial witnesses. Defense lawyers continued cross-examining Gary Wang, one of FTX’s top executives, who testified last week that Bankman-Fried had instructed him to insert a secret backdoor into the company’s code that enabled the theft of customer funds. There were fewer interruptions, with Everdell pointing out some inconsistencies in Mr. Wang’s initial statements to FBI agents and his testimony at trial last week. Prosecutors then called Caroline Ellison, Bankman-Fried’s former girlfriend, who ran a crypto trading firm that the government says tapped into FTX customer deposits. Wang and Ellison have pleaded guilty and are cooperating with the authorities. Bankman-Fried has pleaded not guilty to seven counts of wire fraud and conspiracy.

The collapse of crypto exchange FTX wiped out millions of its customers’ crypto holdings and turned its billionaire founder into a pariah now facing criminal fraud charges in New York, the Wall Street Journal reported. But the fall of Sam Bankman-Fried and his Bahamas-based exchange, which at its peak held more than $10 billion in customer deposits, hasn’t fundamentally changed how crypto works or is regulated. The sector is still the Wild West of finance. Terrorists and money launderers use cryptocurrencies to cover their tracks. Hackers frequently find ways to steal digital coins. Worldwide trading is still concentrated in a huge offshore exchange, Binance, which has been accused of some of the same risky practices as FTX. Although it roiled the crypto world, FTX’s collapse didn’t alter the legal and regulatory landscape. Unlike past crises that spurred U.S. lawmakers into action, this one has legislators divided over how, and even whether, to address crypto markets. Instead, regulators have pursued a piecemeal enforcement campaign designed to impose Wall Street’s rules on crypto — a move the biggest crypto exchanges, such as Binance, are fighting in court. Read more. (Subscription required.)

*The views expressed in this commentary are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.

PG&E Corp. will pay a $45 million penalty for its role in starting the second-largest wildfire in California history under a settlement proposal issued by state regulators, Bloomberg News reported. The California utility giant agreed to the shareholder-funded penalty proposed by the California Public Utility Commission’s safety division, according to a filing Monday. The regulatory agency will vote on the proposal at its November 16 meeting, a statement said. The Dixie Fire started on July 13, 2021, after a pine tree fell on PG&E’s power lines, charring more than 960,000 acres of land and destroying 1,300 structures. It took PG&E workers several hours to respond to the initial sign of trouble on its equipment that state investigators found responsible for causing the blaze. Last year, the utility avoided criminal charges stemming from the fire by reaching a financial settlement with district attorneys representing counties that were impacted by the conflagration. PG&E said that it doesn’t contest three of the CPUC allegations involving record-keeping or process violations, which are unrelated to the fire, and said it will fund an initiative to transition to electric records for its patrols and inspections as part of the agreement. PG&E disputes other alleged violations based on the state’s fire investigation report, the utility said. The agreement doesn’t prevent PG&E from recovering costs related to the blaze, the company added. Preventing wildfires and resolving civil and criminal liability from the blazes have weighed heavily on PG&E for years. Fires sparked by power lines and transformers that have destroyed more than 1 million acres and killed scores of people sent the company into bankruptcy in 2019.