US SEC Says Binance.US Corporation Level Is Poor

2023-09-15 16:18:45

The United States Securities and Exchange Commission (SEC) has expressed concern regarding the level of cooperation of Binance.US in the ongoing investigation into the activities of the cryptocurrency trading platform.

SEC Allegations once morest Binance.US

According to a recent court presentationthe SEC alleges that Binance.US, the US division of global cryptocurrency exchange Binance, has been uncooperative in submitting essential information and complying with regulatory requests. This, according to the SEC, calls into question the exchange’s commitment to transparency and compliance with regulatory guidelines.

To be sure, the SEC’s investigation into Binance.US comes amid increasing scrutiny of cryptocurrency exchanges operating in the United States.

According to the court filing, the regulator mentioned that the holding company for Binance.US, known as BAM, has only submitted 220 documents during the entire discovery process. Besides, almost all documents produced consist of unintelligible screenshots and documents without dates or signatures.

One of the key aspects of the SEC investigation is the demand for critical information related to Binance.US operations, financial records, and user data. This information is crucial for regulators to evaluate the exchange’s compliance with securities laws and investor safeguards.

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However, BAM has refused to present witnesses essential to the deposition and has instead only presented four depositions of witnesses that the exchange deemed appropriate. Meanwhile, the SEC has been able to obtain documents that BAM claimed were not available from other sources.

Binance’s legal problems intensify

Recall that last month, BAM Trading filed a motion seeking a protective order regarding deposition notices and discovery requests made by the SEC.

The exchange noted that the regulator urged its US subsidiary to deliver communications dating back to November 2022, many of which have nothing to do with clients’ assets. even following the exchange has provided sufficient information as stipulated by law.

Notably, the SEC has maintained its position that the Consent Order gives it carte blanche to investigate all aspects of BAM’s asset custody practices without discernible limitations. Since the SEC lawsuit in the US in June 2023, Binance’s US subsidiary has seen several key executive departures and other operational challenges.

Recently, Brian Shrode, the CEO of Binance.US, left his position as the legal battle with the SEC has made life difficult for the company. According to reports, The departure has caused the exchange to reduce its workforce by more than 100 employees.

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