The Securities and Exchange Commission (SEC) has issued a civil penalty of $745,000 (£564,000) penalty to Prager Metis CPAs, LLC related to charges of negligence in its audits of FTX.

In one of the actions, the SEC alleged that Prager Metis misrepresented its compliance with auditing standards regarding FTX.

According to the SEC, from February 2021 to April 2022, Prager Metis issued two audit reports for FTX that falsely misrepresented that the audits complied with US Generally Accepted Auditing Standards (GAAS).

Prager failed to follow GAAS and its own policies and procedures by not adequately assessing whether it had the competency and resources to undertake the audit of FTX.