Mazars Group, a leading international audit, tax, and advisory firm, has paused its services for all crypto clients worldwide, Bloomberg reported on December 16th.
The move comes at a time when investors are concerned about the stability of crypto exchanges in light of recent events – such as FTX’s bankruptcy and Binance’s $3 billion withdrawals.
According to a statement sent by a Binance representative to Bloomberg via email:
Mazars has indicated that they will temporarily pause their work with all of their crypto clients globally, which include Crypto.com, KuCoin, and Binance. Unfortunately, this means that we will not be able to work with Mazars for the moment.
The Binance representative also said that they support greater transparency and are considering the best way to give such specifics in the upcoming months.
Following the collapse of cryptocurrency exchange FTX in November, Mazars, which has its headquarters in Paris, has been at the forefront of the rush by the crypto sector to do so-called “proof of reserves” reports for exchanges like Binance and other significant ones.
However, this information sparked further concerns about the industry. Aside from that, the report stated that requests for comment sent to Mazars, Crypto.com, and Kucoin were not promptly answered.
Although proof of reserves reports are not a thorough audit because they simply list a company’s assets rather than its liabilities, they have come under fire because they act as snapshots of the past that indicate the information given by customers often holds up.
Expert Panned Mazars Documents As “More Worthless”
Fortune Crypto raised questions in a post on December 15th about why Binance and the others did not have their audits performed by one of the Big Four accountancy companies.
Fortune stated that audits carried out by Mazars were recently published by Binance and Crypto.com. Despite not giving a complete picture of assets and liabilities, the filings testify that the firms own significant sums of cryptocurrency.
Additionally, the report claimed that the Mazars records are “more worthless,” according to one accounting expert than audits conducted by the Tether company.
Whereas, the Financial Times pointed out that the new audit released this month by Binance’s CEO, includes many of the same methods used in his previous OKCoin audit from 2015, suggesting that it may be more of a PR campaign rather than an honest accounting effort.
According to the statement:
All this raises the question of why, if they are looking to build trust, Binance and the others didn’t hire one of the Big Four accounting firms to conduct their audits. Is it because they didn’t want the level of scrutiny those firms would provide? Or is it because the firms can’t or won’t conduct a proper crypto audit?
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