Binance
Holdings and its former CEO, Changpeng Zhao, have responded to the United
States Securities and Exchange Commission’s (SEC) move to incorporate Binance’s
admission of guilt to the Department of Justice (DOJ) in its ongoing legal
proceedings.
The
legal dispute between Binance and the SEC commenced on June 5, 2023, when the
agency accused the company of 13 securities law violations, alleging that Zhao
and Binance mishandled customer assets on Binance.US and improperly redirected
or mixed customer assets.
In
a filing submitted to the U.S. District Court for the District of Columbia on
December 12, Binance contested the SEC’s effort to include the $4.3 billion
guilty plea and settlement agreement with the DOJ, deeming it procedurally
incorrect and requesting its disallowance.
In
November, the
DOJ reached a separate settlement with Binance and its former CEO,
concluding its investigation into the company. The settlement mandated Binance
to pay $4.3 billion in penalties and permitted the company to continue its
operations while adhering to U.S. regulations.
While
not formally part of the settlement, the SEC argued that the federal court
overseeing its case should consider the statements and acknowledgments made by
Binance and Zhao in the November 21 settlement.
The
SEC contended that these settlements indicated Binance’s awareness of operating
in the U.S., serving U.S. customers, and utilizing U.S. infrastructure for
transactions. In response, Binance argued that the SEC failed to demonstrate
how the resolutions with the DOJ were relevant to any of the SEC’s “faulty
claims” against Binance Holdings and Zhao.
In
court documents submitted on December 12, 2023, Binance argued that the
SEC’s notice does not substantiate its claims from the June 2023 lawsuit. The
company asserted: “The
SEC Notice is an impermissible supplemental brief that identifies no new
“authority” and instead attempts to introduce new factual information and
arguments. This alone is a reason to disregard it.”
Furthermore,
the company emphasized that presenting a judicial notice is not a substitute
for amending a complaint. According to Binance’s statement, the SEC’s attempt
to leverage resolutions with other agencies reflects a lack of information
regarding any appropriate regulatory authority on the SEC’s part.
💬 MCO NEWS WAVE 🌊
Binance Fights Back Against SEC Lawsuit, Citing Legal Requirements ⚖️
Cryptocurrency exchange Binance, Binance US, and its founder, Changpeng Zhao, have responded to the SEC’s lawsuit by arguing that the SEC didn’t meet the necessary legal requirements.… pic.twitter.com/Vv1ib6MgIO
— Morecryptoonline (@Morecryptoonl) December 13, 2023
Flight Risk Concerns: Judge’s Decision Amidst Extradition
Challenges
Earlier, Finance
Magnates reported that a US
federal judge ruled that Zhao must remain in the United States until his
scheduled sentencing in February, overturning a previous bail agreement that
would have allowed him to visit his UAE residency.
This decision came a day after Zhao pleaded guilty to one
count of violating the Bank Secrecy Act, with a $175 million bond agreement in
place. Concerns about Zhao being a flight risk were raised due to the absence
of an extradition treaty between the US and the UAE, where most of his assets
are located.
The judge acknowledged the defendant’s significant wealth
and family ties in the UAE, emphasizing the challenges in recovering bail
proceeds if Zhao chose not to return for sentencing. The sentencing,
potentially up to 18 months, awaits Zhao, who might serve around 10 months in
prison, with anti-money laundering violations carrying a maximum penalty of 20
years without a plea agreement.
Binance
Holdings and its former CEO, Changpeng Zhao, have responded to the United
States Securities and Exchange Commission’s (SEC) move to incorporate Binance’s
admission of guilt to the Department of Justice (DOJ) in its ongoing legal
proceedings.
The
legal dispute between Binance and the SEC commenced on June 5, 2023, when the
agency accused the company of 13 securities law violations, alleging that Zhao
and Binance mishandled customer assets on Binance.US and improperly redirected
or mixed customer assets.
In
a filing submitted to the U.S. District Court for the District of Columbia on
December 12, Binance contested the SEC’s effort to include the $4.3 billion
guilty plea and settlement agreement with the DOJ, deeming it procedurally
incorrect and requesting its disallowance.
In
November, the
DOJ reached a separate settlement with Binance and its former CEO,
concluding its investigation into the company. The settlement mandated Binance
to pay $4.3 billion in penalties and permitted the company to continue its
operations while adhering to U.S. regulations.
While
not formally part of the settlement, the SEC argued that the federal court
overseeing its case should consider the statements and acknowledgments made by
Binance and Zhao in the November 21 settlement.
The
SEC contended that these settlements indicated Binance’s awareness of operating
in the U.S., serving U.S. customers, and utilizing U.S. infrastructure for
transactions. In response, Binance argued that the SEC failed to demonstrate
how the resolutions with the DOJ were relevant to any of the SEC’s “faulty
claims” against Binance Holdings and Zhao.
In
court documents submitted on December 12, 2023, Binance argued that the
SEC’s notice does not substantiate its claims from the June 2023 lawsuit. The
company asserted: “The
SEC Notice is an impermissible supplemental brief that identifies no new
“authority” and instead attempts to introduce new factual information and
arguments. This alone is a reason to disregard it.”
Furthermore,
the company emphasized that presenting a judicial notice is not a substitute
for amending a complaint. According to Binance’s statement, the SEC’s attempt
to leverage resolutions with other agencies reflects a lack of information
regarding any appropriate regulatory authority on the SEC’s part.
💬 MCO NEWS WAVE 🌊
Binance Fights Back Against SEC Lawsuit, Citing Legal Requirements ⚖️
Cryptocurrency exchange Binance, Binance US, and its founder, Changpeng Zhao, have responded to the SEC’s lawsuit by arguing that the SEC didn’t meet the necessary legal requirements.… pic.twitter.com/Vv1ib6MgIO
— Morecryptoonline (@Morecryptoonl) December 13, 2023
Flight Risk Concerns: Judge’s Decision Amidst Extradition
Challenges
Earlier, Finance
Magnates reported that a US
federal judge ruled that Zhao must remain in the United States until his
scheduled sentencing in February, overturning a previous bail agreement that
would have allowed him to visit his UAE residency.
This decision came a day after Zhao pleaded guilty to one
count of violating the Bank Secrecy Act, with a $175 million bond agreement in
place. Concerns about Zhao being a flight risk were raised due to the absence
of an extradition treaty between the US and the UAE, where most of his assets
are located.
The judge acknowledged the defendant’s significant wealth
and family ties in the UAE, emphasizing the challenges in recovering bail
proceeds if Zhao chose not to return for sentencing. The sentencing,
potentially up to 18 months, awaits Zhao, who might serve around 10 months in
prison, with anti-money laundering violations carrying a maximum penalty of 20
years without a plea agreement.