The FTX Claims Portal Fiasco: How $250 Million in Legal Fees Produced a Buggy Mess

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Appointed to oversee FTX’s bankruptcy proceedings, the lawyers and consultants have raked in over $250 million in fees over the past 8 months.

The long awaited FTX claims portal was finally launched on 11 July 2023Only to go offline mere hours later for unknown reasons: Overload, crash?

This creation was supposed to simplify, to streamline, to provide clarity from chaos. A high-tech gift for creditors long denied transparency and voice, to fill their claims.

But reality often deviates from the script…

FTX’s long-awaited claims portal launch has been an absolute disaster. 

Many users quickly encountered problems, ranging from unfinished KYC verification to balances not matching records.

Cries for help on Twitter and confusion over the filing process expose glaring issues with the portal’s development.

A Microcosm of FTX's Failures: Incompetence Covered by a Veneer of Competence

Creditors found no relief – just insult added to injury…

It has been plagued with issues, calling into question whether these exorbitant legal fees are justified.

KYC Verification - The Roadblock to Filing Claims

One major pain point is Know Your Customer (KYC) verification.

The portal requires this step before claims can be filed. But numerous users report extended processing times.

“I did my KYC over 2 days ago, still processing. This is beyond frustrating,” laments one user.

Another user @ericschweizer remarks: “I have been stuck on KYC for 3 weeks now. Can’t get them to respond to tickets, can’t restart the process. I just tried to login and not sure why it was rejected What should I do?”

With balances already agreed to, the KYC roadblock creates unnecessary delays.

For filers who do complete KYC, problems continue with missing features. 

Lost in Cyberspace - Creditors Meet... Dead Ends

Multiple users met dead ends, with no submit button showing after filling out claims forms.

A portal to… nowhere.

“Jumped through all the steps just for the ‘Submit’ button to never show lmao” tweets @xlampsx about the glitch.

These omitted features obstruct even good-faith attempts to file claims.

The Blame Game - Contractors and Lawyers Point Fingers While Creditors Wait

Making matters worse, FTX’s support team and KYC partner blame each other for stalled verifications.

“Support is horrible. KYC partner said they can’t help us and blame FTX team, but FTX support says KYC partner will handle reverifications,” remarks @Icyflame141.

This finger-pointing between contractors only breeds more confusion.

Let’s play the blame game. 

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Left Guessing - FTX Creditors Face Mismatched, Vanished, and Negative Balances

Adding insult to injury, balances shown frequently conflict with users’ records.

“Anyone else have a difference in the balance reported and what they think they had? Mine was at least $1000 smaller,” asks @ChrisK_999.

Such discrepancies erode trust in the process and validity of the portal’s data.

Making matters worse, some creditors trading on perpetual swaps were left with unexplained negative balances from profitable trades.

And creditors holding FTX’s tokenized stocks faced an even more dire situation, as these assets didn’t even appear at all on the portal’s balances.

As @lemmykoopah asks, “My token stocks aren’t listed on my balance claim. Am I f**ked?”.

Technically, the exclusion of tokenized equities represents a complete denial of claims for these users.

Adrift and Dry - A Betrayal for FTX Creditors.

FTX creditors face new obstacles even after submitting claims.

User @Raging_Bulla reported successfully filing a claim, only to have the portal later display an E-sign error on the submitted form.

“Mate this is a bloody sham,” he remarked. “The claim I put in last week shows as submitted but now it has an ‘error’ in the E-Sign section. There couldn’t have been an error when I submitted it or it would have flagged it.”

Such retroactive glitchescast doubt on the portal’s data integrity.

Even successfully submitted claims can not be found​.

Not even specialized restructuring counsel can make sense of the chaos.

When Lawyers Fail, Twitter Provides: FTX Community Crowdsources Own Support

That discord-based system faced even harsher criticisms for being fragmented and difficult to use.

Nonetheless, creditors reasonably expected a quality portal justified by 8 months and $250 million in legal work.

But with its spotty KYC, half-baked features, and inaccurate data, the current portal gives creditors little confidence.

The lack of accountability and oversight will likely only amplify demands for refunds of exorbitant lawyer fees.

As a result, Twitter user @sunil_trades has emerged as an unofficial champion for lost FTX creditors

Aggregating complaints and answering questions, his tweets reveal the sheer breadth of problems with the claims portal.

From credentials not working to missing features for filing claims, @sunil_trades paints a damning picture of the portal’s launch.

Sunil and other users continue crowdsourcing solutions and updates.

But this ad hoc support reveals the deeper issues plaguing the official claims process.

For law firms charging $250 million in fees, FTX creditors deserve better than a buggy portal held together by Twitter threads.

The shoddy portal represents a microcosm of FTX’s larger failings – technical ineptitude covered up by a veneer of competence.

For FTX creditors owed billions in missing funds, the portal fiasco marks another bitter betrayal on the long road to restitution.

But banding together and speaking out remains our best chance at redemption.

Only through public pressure and lawsuits can meaningful accountability emerge from the FTX rubble.

We find hope in community and resilience in the face of incompetence.

The Art of the Flop: An Anthology of Epic Fails

When it comes to botched product launches, few can compete with the utter disaster that these lawyers have set on… proof that a premium price in the world can’t mask a shoddy, half-baked product. 

United we rise.

The crowdsourced support led by champions like @sunil_trades reveals the depths of our bonds and capabilities when we band together.

This portal fiasco demonstrates again the power of our community.

United and resilient, we can forge our own solutions when institutions fail us.

Though bitterly betrayed, we still find hope in solidarity.

Our voices are amplified, our concerns validated.

Let institutions take note: the strength of our community endures incompetence and prevails against all odds.

Amateur work at professional rates

So in summary – the portal did “launch” on July 11th in that a site became accessiblebut major components were not functional, were missing, or contained errors that prevented users from actually filing their claims.

The user experience was likely equivalent to a non-working portal, even if some backend access was possible.

Yes, the portal is a joke. An expensive 250m usd joke. A complete shame.

Creditors pay premium prices but receive defective products.

Stop the madness?

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R M
R M
10 months ago

One other issue. I’m asked to confirm whether fiat and crypto balances are correct with Y/N radio buttons on the form. I can selected these for fiat, but not for BTC. See attached screenshot. There is no way to select Yes or No in this column.

Screenshot_20230715-130428_Gallery.jpg
Meezan
Meezan
10 months ago

heyy my KYC has been stucked from 2 weeks , can someone assist me ?
https://twitter.com/wtfmeez/status/1686008286468796417?s=20

F2XnmLBWMAAI8U3.jpeg
Joe
Joe
10 months ago

Filled my claim and received an email with a pdf copy of it. But checking on my KYC today, I noticed an E-sign error DAYS AFTER my claim was submitted: received the confirming email, and when checking, my e-signature is showing an error.

I feel bad and in doubt, is my claim valid or no?

2023-07-31 21.21.15.jpg
BBowl
BBowl
10 months ago

I just dislike the fact that they don’t update us even on their official site when there is something new to do or just any progression

Resh
Resh
Reply to  BBowl
10 months ago

0 communication, shame on them. Not talking about the formatting of their email, look like a 1994-written style email.

Disan
Disan
10 months ago

This is the biggest shit i have seen in my life. Celsius was easy as 1-2-3 but this is above everything we could collectively imagine together.

Liquid User
Liquid User
10 months ago

Hello Delaware Bankruptcy Court. It’s confirmed.

The Claims Portal needs a fix for Liquid users (an entire exchange), otherwise KYC fails.

#.jpg
Liquid User
Liquid User
Reply to  Liquid User
10 months ago

This just in

Declaration from “FTX Team”: We can’t verify you, we’re sorry!

liquid-new-1.jpg
RemyUCT
Admin
Reply to  Liquid User
10 months ago

Damn… My KYC is on hold since weeks and the support literally told me not to open a ticket. I basically just have to wait and do nothing while time flies and i dont see my claim listed on Kroll.

Liquid User
Liquid User
Reply to  Liquid User
10 months ago

24 hours later

FTX support — logon to Liquid instead

WHAT THE HELL!!?

liq920.jpg
macdaddy
macdaddy
10 months ago

Is FTT token claim allowed now? I see on RM’s screenshot below that its an option, whereas when I started through the claims process, (I had only FTT ) they simply said I have no claimable tokens. It’s almost like they are, through extreme incompetence, are trying to punish the crypto world in general. How dare we challenge the banksters?

FTT allowed.jpg
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