Voyager, an insolvent cryptocurrency lender, intends to resolve claims of CEO and CFO negligence.

According to court documents filed on Monday, following an internal investigation into how the cryptocurrency lender Voyager Digital handled loans given to the cryptocurrency hedge fund Three Arrows Capital (3AC), Voyager Digital intends to reach a settlement with two of its top employees.

According to the documents, in March, CEO Stephen Ehrlich and then-Chief Financial Officer Evan Psaropoulos consented to allow Voyager to lend Three Arrows almost $1 billion in cryptocurrency with little to no financial reporting from the fund.

Voyager wanted to know how the crash of LUNA and its sibling token terraUSD would affect Three Arrows, but at first they were advised that Three Arrows had just a small quantity of exposure to LUNA. Tim Lo, a 3AC employee, said that Voyager returned all of its investments to 3AC later in June, though, since he was worried that the company's owners were just not responding to inquiries from Lo and other employees.

After receiving that message, Voyager immediately returned all of its existing loans to 3AC, and the investment firm shortly went into liquidation in the British Virgin Islands.

A special committee made up of two Voyager trustees concluded that it would be costly and challenging to pursue malpractice charges against Ehrlich and Psaropoulos, who is currently the company's chief commercial officer, and that Voyager would be unlikely to receive much compensation.

Rather, Voyager is recommending a compromise in which Ehrlich would pay $1.1 million in cash to Voyager, seek $20 million in benefits under his directors and executives insurance coverage, and keep Psaropoulos and Ehrlich in their existing positions.

The bankruptcy judge in the case must first approve the deal.

Voyager, a company with headquarters in Toronto, filed for bankruptcy in New York in July, largely as a result of the damages on its loans to Three Arrows.

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