The SEC Accuses Binance Unitedย States of Non- Participation in Probe
The Unitedย States Securities and Exchange Commission (SEC) has accused Binance Unitedย States of non- participation in a probe into alleged federal securities law violations. The SEC is concerned about the use of Ceffu, a custody service provided by Binanceโs international arm, which they believe violates a previous agreement prohibiting the transfer of assets abroad. During the discovery phase, Binance USโs holding company, BAM, has been uncooperative, providing only around 220 documents that are undated, unsigned, or incomprehensible screenshots. They have likewise been reluctant to present key witnesses for deposition. The SEC has received relevant documents from other sources that BAM claimed did not exist.
Probable Violations of Consent Order
Due to the limited disclosure, there are suspicions that BAM may have violated the consent order that restricts access to funds to only US-based personnel. The SEC is particularly concerned about the use of Ceffu, a wallet custody software provided by Binance Holdings Ltd. This raises questions about other factions within Binanceโs network having control over Unitedย States clientsโ assets.
Binance Unitedย States Defends Itself
Asย aย result to the SECโs apprehensions, Binance Unitedย States claimedย that the concerns regarding Ceffu are exaggerated and referred to the request for additional documents as a โpointless fishing expedition.โ They stated that being a provider of the Ceffu software does not provides them access or custody over customer funds.
SEC Lawsuit and Internal Crisis
This latest accusation comesย after a lawsuit initiated by the SEC against Binance on June 5. The SEC has charged Binance with numerous violations, including unregistered securities offerings and its staking initiative. Inย addition, Binance Unitedย States is facing an internal crisis with plentyย of high-profile departures, including the CEO, head of legal, and chief risk officer.
Hot Take: Binance Unitedย States Faces SEC Scrutiny for Alleged Non-Cooperation
The SECโs accusations against Binance Unitedย States for non- participation in a probe into federal securities law violations have raised concerns about the use of Ceffu, a custody service provided by Binanceโs international arm. The limited disclosure and reluctance to present key witnesses have led to suspicions of probable violations of a consent order. Binance Unitedย States has defended itself, dismissing the SECโs concerns as overblown. This accusation comes amidst an existing lawsuit by the SEC against Binance for numerous violations. Inย addition, Binance Unitedย States is dealing with an internal crisis marked by wholeย lotย of departures. The outcome of this investigation will determine futureย ofย the Binance Unitedย States and its compliance with regulatory requirements.
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