Lawyers representing United States-based cryptocurrency exchange Binance.US, global exchange Binance Holdings Limited, and Binance CEO Changpeng "CZ" Zhao filed a motion alleging that the US Securities and Exchange Commission (SEC) misled the public in statements issued about an ongoing securities lawsuit. .
In a June 21 filing in the US District Court for the District of Columbia, the legal teams for Binance, Binance.US, and CZ claimed that the SEC had made "misleading" statements in a press release from the June 17 and filed a motion to the financial regulator. to comply with the “applicable rules of conduct”. the filler referred to SEC Director of Compliance Gurbir Grewal, alleging that CZ and Binance could “mix client assets or divert client assets as they see fit” and an order requiring all parties involved in the lawsuit to return to the United States.
“The SEC has no evidence that BAM [Binance.US] client assets have been dissipated, commingled or misused in any way,” the June 21 filing said. “The SEC press release also appears to be designed to introduce unwarranted confusion into the marketplace, which could have the effect of hurting BAM's clients rather than protecting them. You also run the risk of contaminating the jury with misleading descriptions of the evidence relating to the defendants."
Lmao @ Binance vs. the SEC #FireGenerals
Court: "I want to know, are BAM's assets going offshore? Is it happening or not? I'm surprised I've asked each of the SEC lawyers this question 5 times."
SEC: "So currently the assets are not going offshore... We're not... pic.twitter.com/QkEY5HM2ji
— Tree of Alpha (@Tree_of_Alpha) June 21, 2023
The order, if approved by a federal judge, could prevent the SEC from issuing certain public statements about the Binance lawsuit for the duration of the case that "may have a material impact on the court proceedings." Binance's legal team provided part of a transcript of a June 13 hearing in which SEC counsel acknowledged there was no evidence that Binance.US assets were "going overseas."
"The SEC's press release is misleading, contains statements that the SEC knows are not supported by evidence, and is inconsistent with rules of professional conduct."
Related: 'All SEC Claims Fail': Binance.US Refutes Motion to Freeze Funds
The court filing is part of the Ongoing SEC lawsuit Against Binance, Binance.US and CZ filed on June 5 alleging unregistered security offerings and Binance's failure to register as an exchange or broker-dealer clearing agency. SEC Chairman Gary Gensler said at the time that CZ and Binance had "misled investors about their risk controls," and the regulator was seeking a recall and other sanctions.
The SEC filed a motion in an attempt to have the court freeze all Binance.US assets, but ultimately reached a compromise agreement in which only exchange employees would have access to client funds while litigation was ongoing. Amid US legal proceedings, Binance announced the launch of a regulated crypto platform in Kazakhstan.
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