- The SEC has filed charges against Binance and CZ with 13 counts, including buying and selling unregistered securities, trading, and commingling with customer funds.
- The lawsuit follows the CFTC suing Binance in March for violating federal securities laws.
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The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against one of the world’s largest cryptocurrency exchanges, Binance, and its CEO, Changpeng “CZ” Chao. according to To the official announcement from the SEC.
The regulatory body Blame Binance has been indicted on 13 counts of ignoring a number of federal securities regulations, including allegations of operating unlicensed stock exchanges under Binance.com and Binance.US.Official case file details state:
“This lawsuit arose from defendants’ blatant disregard for federal securities laws and the investor and market protections these laws provide.”
Despite publicly stating that U.S. customers are banned from trading on Binance.com, the SEC said Zhao said, “Binance has actually subverted its own control, allowing high-value U.S. customers to sell Binance.com. We have confidentially authorized them to continue trading on the com platform.”
“Furthermore, the SEC publicly claims that Zhao and Binance have created Binance.US as a separate and independent trading platform for US investors, while Zhao and Binance are controlling the operation of the Binance.US platform. They claim they were secretly managing it behind the scenes.”
CZ took to Twitter before the SEC announced its official announcement, tweeting the number 4, which stands for FUD, or ignoring fear, uncertainty and doubt.
Our team is all on standby to make sure the system is stable, including withdrawals and deposits.
We will take action as soon as we confirm the complaint. Haven’t seen it yet. The media gets information before we do.
— CZ 🔶 Binance (@cz_binance) June 5, 2023
The charges range from manipulating client assets, mixing client funds and diverting them to Sigma Chain, an entity owned by Zhao. BAM Trading and BAM Management US Holdings, the companies that manage Binance.US alongside Binance, have been accused of misleading “investors about trading regulations that do not exist on the Binance.US platform,” while Sigma Chain It is accused of engaging in “manipulative trade practices that inflate profits.” trading volume of the platform; “
An SEC lawsuit filed in the United States District Court for the District of Columbia accuses trading platforms of violating federally registered securities. Both Binance and BAM Trading are responsible for operating unregistered domestic stock exchanges, broker-dealers and clearinghouses, as well as unregistered offerings and sales of BNB and the stablecoin Binance USD (BUSD). The SEC holds Mr. Zhao personally responsible for these alleged registration violations.
SEC Chairman Gary Gensler said in a press release, warning the public to be cautious about investing assets using such illegal platforms.
“Across 13 indictments, we allege that Zhao and Binance entities engaged in widespread deception, conflicts of interest, lack of disclosure, and deliberate evasion of the law.”
SEC Director of Enforcement Gurbil Grewal emphasized Gensler’s warning, stating that “Zhao and Binance companies not only knew the traffic rules, but consciously circumvented them, putting their customers and investors at risk. I chose to do this in order to maximize my own profit.”
These SEC allegations are as follows Commodity Futures Trading Commission Lawsuit Against Binance. The CFTC targeted crypto exchanges and their CEOs in March, accusing them of intentionally facilitating the trading of unregistered crypto derivative products within U.S. territory, a clear violation of federal law. claimed. Genlzer further stated:
“Today’s charges start that process, even though they’ve been trying for years to ‘free themselves’.”