A recently unsealed complaint from the bankrupt crypto lender Genesis reveals that executives at its parent company, Digital Currency Group (DCG), were aware of financial mismanagement and potential legal issues. The Delaware Court of Chancery filing indicates that DCG's CFO, Michael Kraines, recognized the risk of Genesis being seen as DCG's 'alter ego.' In a confidential memo, he discussed preparing for legal challenges if Genesis were to fail, highlighting concerns about the impact on DCG's board and shareholders. The complaint also notes that DCG ignored warnings from third-party risk consultants and acknowledged that Genesis was 'flying blind' as its loans surged from $4 billion to $12 billion. Internal audits had flagged significant deficiencies in Genesis's financial controls as early as 2020. Additionally, the complaint describes a toxic workplace culture where Genesis employees prioritized DCG's interests over proper governance. Genesis is now seeking to recover over $3.3 billion from DCG and its executives. Read more AI-generated news on: https://app.chaingpt.org/news