The Securities and Exchange Commission (SEC) has made a significant development in its investigation into Binance‘s activities. SEC has issued a warning to the exchange to comply with certain actions.
The new filing emerged as part of the ongoing SEC case, which was filed on June 5, 2023, for violating securities laws and operating as an unregistered exchange, broker, and clearing agency in the United States.
The US agency SEC had accused Binance Holdings and Binance co-founder Changpeng Zhao of refusing to provide any information regarding the tracking, security, and existence of US customer assets, among other organizations. SEC officials also revealed that Binance partner BAM Trading Services, after approximately two months from court approval, had refused to provide “anything beyond extremely limited information.”
In the filing dated September 14, 2023, SEC continues to seek information to assess whether BAM controls the customer assets and whether Binance has violated the court order with the limited information provided so far. Therefore, if the court accepts to examine these allegations, the Binance SEC investigation could take a new turn.
SEC stated that it had issued requests focusing on ensuring that all customer and BAM assets are properly presented and evaluated. It added that BAM had only agreed to take the statements of four witnesses while refusing to present key witnesses for testimony. However, the filing included the following statement:
BAM has only produced approximately 220 documents; many of these relate to reporting required under the Consent Order and many consist of unintelligible screenshots and documents without dates or signatures.
Interestingly, amidst all these events, the SEC filing was published at a time when Binance’s US Legal Counsel and Chief Risk Officer resigned from the company, and high-level departures have been ongoing in recent weeks.