Binance: US SEC Files Motion to Unseal Confidential Documents

Paigambar Mohan Raj

The US SEC (Securities and Exchange Commission) has filed a motion to unseal confidential documents in its lawsuit against Binance, its US arm, and CEO Changpeng Zhao (CZ). The move is a reversal of the SEC’s previous motion to seal the documents. Both the plaintiff and the defendants have agreed to the motion to unseal the documents filed last month. According to the filing,

“The SEC also does not oppose the sealing or partial sealing of certain documents designated as confidential by Defendants BAM Trading Services Inc. and BAM Management US Holdings Inc. (together, “BAM”), if they continue to request confidentiality.”

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The documents in question include those in regard to “Motion to Compel and For Other Relief” and “Opposition to Binance.US’ Motion for a Protective Order.” The US arm of the exchange requested a protective order in response to the SEC’s request to file sealed documents. As per the SEC, this has significantly delayed the lawsuit. Both Binance and the SEC agree that some documents should be made public. Meanwhile, others are under the Disputed Documents category.

Is Binance not cooperating with the SEC?

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The SEC has accused the exchange of not cooperating in its probe. Regulators are worried that the exchange’s custody service, Ceffu, violated a previous deal aimed at stopping assets being moved overseas. As per the SEC, Binance’s holding company, BAM, has given “only approximately 220 documents … many that consist of unintelligible screenshots and documents without dates or signatures.”

Meanwhile, in response, the exchange said that the regulator’s worry is “much ado about nothing.” According to Binance, creating wallets to provide the Ceffu software does not mean the international arm of the exchange has access to customer funds.

Furthermore, the exchange has found itself in quite a predicament. Several top executives, such as the American arm’s CEO, Legal head, and Risk Officer, have stepped down. The development has added to fears that things may not be going smoothly within the exchange.

Also Read: Binance US Chief Risk Officer & Head of Legal Resign