The US Securities and Exchange Commission (SEC) has claimed that Binance has failed to provide sufficient documentation despite previously agreeing to expedited discovery.
BAM, the organization responsible for Binance’s US affiliate, has submitted approximately 220 documents. However, the SEC’s legal representatives have alleged in a new filing that many of these documents consist of “unintelligible” screenshots and lack essential dates or signatures.
The SEC initiated a legal action against Binance on June 5th, bringing forth a total of 13 charges against the platform. These allegations include violations of US securities laws and the failure to prevent investors in the country from accessing Binance.com and conducting operations without proper registration as an exchange, broker, and clearing agency.
In a new twist to the ongoing courtroom drama, the SEC has alleged Binance of not cooperating in the ongoing probe, according to the unsealed documents.
Furthermore, the financial regulator also claimed that BAM has refused to make essential witnesses available for deposition. Instead, the entity chose to provide only four depositions of witnesses that it had independently selected.
“It has responded to requests for relevant communications with blanket objections and has refused to produce documents kept in the ordinary course of its business, claiming those documents do not exist, only for the SEC to later receive such documents from other sources.”
The SEC also voiced concerns about Binance.US’s use of Ceffu, a custody service offered by Binance’s international arm – Binance Holdings Ltd – which appeared to be in violation of a previous agreement designed to prevent the transfer of assets abroad.
The SEC pointed out that BAM provided conflicting statements regarding the roles of Ceffu and Binance in wallet management and customer funds. Initially, BAM asserted that Ceffu served as its wallet custody software and service provider, but later, the entity stated that Binance was its wallet custody software provider.
In a letter to its staff back in June, Binance anticipated a prolonged and costly legal battle with the SEC. Consequently, it requested Binance.US management to downsize the workforce. Amid the internal challenges faced by Binance.US, several high-ranking utives have departed from the company.
Notably, CEO Brian Shorder recently became the latest addition to the growing list of top utives who have left the firm this year.
