Binance Claims SEC is “Abusing the Discovery Provisions,” Files for Temporary Restraining Order
According to Binance, the SEC’s discovery demands go beyond what was allowed by a judge in June.
In its continuing conflict with the U.S. Securities and Exchange Commission, global cryptocurrency exchange Binance has resorted to a request for protection. The SEC’s discovery requests, which stem from a court order in June, were challenged by the exchange on August 14.
The SEC has turned down BAM’s suggestions and has refused to significantly scale down its requirements. The SEC’s stance is irrational and indicative of a larger pattern of Consent Order discovery abuse by the SEC.
According to Binance, the SEC has exploited the June order, which provided the agency with insight into Binance’s practises relating to the custody and security of client funds, to request a wide variety of documents. The market believes that many of these records are only marginally related to consumer property.
Customer assets are now safe and accessible, but the SEC is pursuing a fishing expedition rather than seeking the restricted and “limited” discovery permitted by the Consent Order. Concerning and unwarranted, the SEC’s attitude.
Binance is requesting a protective injunction to limit the SEC’s ability to investigate the exchange. It suggests that just four key exchange workers be subject to depositions, rather than more senior executives like Zhao or its CFO.
This comes after the SEC filed a complaint in June accusing Binance and Binance.US of conducting unregistered securities exchange business and related transactions. Notably, Binance also has to deal with problems from the Commodity Futures Trading Commission, which is another part of the US regulatory system.