Binance Responds to SEC’s Notice on Settlement
Binance Holdings and its former CEO, Changpeng Zhao, have filed a response to the U.S. Securities and Exchange Commission’s (SEC) recent notice of supplemental authority concerning Binance’s settlement with the U.S. Department of Justice (DOJ).
In its latest filing, Binance has claimed that the SEC’s attempt to incorporate the outcomes of the $4.3 billion guilty plea and settlement agreement with the DOJ is procedurally improper and impermissible.
The SEC’s move is seen as an effort to bolster its case against Binance Holdings and Changpeng Zhao, who have been embroiled in a legal dispute since June 5, 2023.
DoJ and FinCEN Settlement Irrelevant to SEC Lawsuit
In response to the SEC’s notice, Binance argued that the regulatory body failed to establish the relevance of the resolutions reached with the DOJ to the SEC’s asserted claims, dismissing them as ‘defective.’
The company, in court documents filed on December 12, 2023, contended that the SEC’s notice was procedurally flawed, constituting an impermissible supplemental brief that introduced new factual information and arguments without merit.
Highlighting the SEC’s attempt to leverage resolutions from other agencies, Binance pointed out a lack of notice regarding any pertinent regulatory authority on the part of the SEC.
The response emphasized that providing judicial notice is not a substitute for amending a complaint, and the SEC’s efforts to benefit from resolutions outside its jurisdiction further underscored the agency’s apparent lack of regulatory clarity.
As the legal saga unfolds, it remains uncertain how the SEC will substantiate its claims against Binance, specifically regarding allegations of operating unregistered national securities exchanges, broker-dealers, and clearing agencies.
CZ is currently waiting in the US to hear his sentencing in February where he could face a prison time of up to 18 months.
Hot Take: Binance Challenges SEC’s Incorporation of DoJ and FinCEN Settlement
Binance Holdings and its former CEO, Changpeng Zhao, have responded to the U.S. Securities and Exchange Commission’s (SEC) attempt to incorporate the outcomes of Binance’s settlement with the U.S. Department of Justice (DOJ). Binance argues that the SEC’s move is procedurally improper and impermissible. The company claims that the SEC failed to establish the relevance of the DOJ settlement to its asserted claims and dismisses them as ‘defective.’ Binance also highlights a lack of notice regarding any pertinent regulatory authority on the part of the SEC. The response emphasizes that providing judicial notice is not a substitute for amending a complaint and criticizes the SEC’s apparent lack of regulatory clarity. As the legal battle continues, it remains uncertain how the SEC will substantiate its allegations against Binance.
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