Crypto Auditors Risk Sanctions for Proof of Reserves Claims

Audit firms could face tough penalties for deceptive statements made by their crypto clients that mislead investors about the extent of their work, the SEC’s top accountant warned on Thursday.

“No audit firm is too small, or too big, to be suspended from appearing or practicing before the commission,” Paul Munter, chief accountant to the Securities and Exchange Commission, said Thursday in a statement.

Munter previously took aim at proof of reserve reports, which crypto platforms and stablecoins have touted to assure customers about the safety of their holdings. Many hired accounting firms to test whether cryptocurrency assets existed ...