An investor and director of LedgerX has withdrawn his funds and claimed that the firm could be failing its investors in a letter obtained by DC Forecast as we are reading further in the blockchain news.
In a letter addressed to the LedgerX Holdings board, LedgerX LLC board, LedgerX shareholders, and the Office of the Inspector General at the Commodity Futures Trading Commission (CFTC), the LedgerX Director Nicholas Owen Gunden wrote that he is worried about how the company was working since the founders of the firm were placed on administrative leave on Dec. 9.
“I am concerned with recent developments at the company, particularly the fact and manner in which the founders, Paul Chou and Juthica Chou, and particularly Juthica, have been barred from continuing their roles at the company,” he wrote.
According to an exhibit filed by LedgerX in the designated contract market (DCM) application of LedgerX, Gunden was a board member since 2017, as a market participant and was on the disciplinary panel of the firm as of 2019. In a three-page letter in which he lists his concerns, he explained that since the ousting of the founders, no one has worked as his point of contact and claimed that there are some of the shareholders that are receiving preferential treatment.
“Just days after Paul and Juthica were placed on administrative leave, a petition was circulated at the office, which 75% of employees signed in support of retaining Paul and Juthica’s leadership. I have seen a copy of this petition and believe it to be legitimate,” he wrote.
But two of the employees who filed the petition were let go, “apparently in retaliation,” he suspects. He is also worried that the company could be no longer compliant with the regulatory requirements and could be failing in the fiduciary duties that are held sacred in the business world. Also, there are other worries about the Holdings board presenting “overly pessimistic” financial statements to the board of directors, that the company is not trying to gather finance outside of MIAX and that the company is paying an extra $60,000 monthly for the security company.
“From what I can tell, the Holdings board is engaged in grossly negligent actions towards LedgerX market participants, employees, shareholders, and perhaps even CFTC compliance requirements themselves,” he wrote.
As such, many employees are expecting the worst, Gunden wrote: “I have spoken with two current employees and learned that there is a lot of confusion and uncertainty at the company, and I’ve received reports that many employees are interviewing elsewhere in anticipation of the company shutting down.”
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