In a court filing dated September 14, the United States Securities and Exchange Commission (SEC) has levelled accusations of non-cooperation against Binance.US in the ongoing investigation involving the cryptocurrency exchange.
Within the court filing, the SEC highlighted that Binance.US’s holding company, BAM, has been uncooperative in producing relevant documents for the discovery process. Out of the documents provided, 220 in total, many were described as “unintelligible screenshots” and lacked critical information such as dates and signatures.
Moreover, BAM has been reluctant to produce essential witnesses for deposition, opting instead to agree to only four depositions of their choosing. The SEC noted that BAM has responded to requests for relevant communications with blanket objections and has even claimed that certain documents do not exist, only for the SEC to receive those documents from alternative sources later.
The SEC also expressed concerns regarding Binance.US’s utilisation of Ceffu, a wallet custody software provided by the global entity Binance Holdings Ltd. The regulatory body pointed out that BAM needed to provide consistent statements about the role of Ceffu and Binance in wallet and customer funds management. This inconsistency raised suspicions about potential violations of a prior agreement meant to prevent funds from being diverted overseas.
The SEC initially filed a lawsuit against Binance on June 5, citing 13 charges against the cryptocurrency exchange, including allegations of unregistered securities offerings, violations involving products like Simple Earn and BNB Vault, and issues with its staking program. The SEC contended that Binance.com, Binance.US, and BAM Trading should have registered as clearing agencies, broker-dealers, and exchanges. Notably, the unregistered offer and sale of Binance.US’ staking-as-a-service program necessitated BAM Trading to register as a broker-dealer.
These recent accusations from the SEC against Binance.US add to the turmoil the exchange is already facing due to an internal crisis. CEO Brian Shorder recently became the latest high-ranking Binance executive to depart the firm, following the resignations of the head of legal and the chief risk officer within a short time.
