In his report, EY stated that the stock market’s operations were significantly flawed in financial reporting and operational control.
In addition to managing most of the activities by a single person, EY says that the current founding partner Gerald Cotton – there is no separation between tasks and basic internal controls, or the funds of Quadriga and its users.
Moreover, EY says that a significant amount of users’ crypto money at Quadriga has been transferred to personal accounts controlled by Cotten on competing exchanges. Denetim It is understood that users’ crypto money is bought and sold on these exchanges and in some cases it is used as collateral for Cotten’s margin trading account. Denetim
In addition, it was stated that Cotten traded on the platform by creating fake accounts in Quadriga. EY also underlined that Cotten’s losses in rival exchanges affected Quadriga’s crypto currency reserves.
The audit company reported that Quadriga owed $ 162 million to its 76,000 users and that 9,450 Bitcoins, 387,738 Ether and 239,020 Litecoins were transferred from Quadriga’s wallets to competing exchanges between 2016 and 2019.
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