Court appoints examiner in Celsius bankruptcy case

The court has approved an examiner for the Celsius bankruptcy case, according to a new order signed by bankruptcy judge Martin Glenn.

The U.S. Trustee, the representative of the Department of Justice in the bankruptcy process, asked the court to approve Shoba Pillay earlier this morning. 

Pillay is a partner at the law firm Jenner & Block where she co-chairs the firm’s Data Privacy and Cybersecurity Practice. She’s also a partner in the firm’s Investigations, Compliance, and Defense Practice and the National Security, Sanctions, and Export Controls Practice.

Before entering the private sector in 2021, Pillay was an Assistant U.S. Attorney in the Northern District of Illinois for more than 11 years. At Jenner & Block, Pillay conducts internal and government-related investigations related to cybersecurity issues.

Pillay will produce a report on Celsius’ storage of crypto holdings, account management for customers, the status of its mining business and tax issues. 

The court elected to appoint an examiner to Celsius earlier this month. Though a rare measure in Chapter 11 cases, the U.S. Trustee first moved to appoint an outside party to conduct an investigation into Celsius to gain more transparency into the firm’s leadership and business practices in the lead-up to its collapse. State securities regulators soon filed in favor of the motion, citing allegations that the firm misled investors and offered unregistered securities. 

The committee representing creditors and customers was initially hesitant for the Celsius estate to incur the expense of an outside examiner. The group reached an agreement with the U.S. Trustee once the office narrowed the scope of the examiner’s investigation.

The creditor committee is conducting its own investigation into Celsius leadership – the findings of which recently led it to call for the removal of CEO Alex Mashinsky, who subsequently resigned.

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