The SEC wants a court to compel Ripple to release financial statements
Attorneys for the United States Securities and Exchange Commission (SEC) filed a petition in federal court to compel Ripple to provide certain documents related to its execution.
In a Jan. 11 filing in the U.S. District Court for the Southern District of New York, the SEC asked Judge Sarah Netburn to order the release of financial statements from 2022 to 2023 and “post-complaint contracts governing ‘institutional sales'.” A judge ruled in July 2023 that contracts containing information on institutional sales only qualify as securities when the commission sells XRP tokens to institutional investors.
“Judge Torres requested this limited and targeted discovery to help the SEC find Ripple liable for violating Section 5 of the Securities Act of 1933. […] He said the court should grant reliefs such as injunctive relief and civil penalties and to what extent the latter should be granted.
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The SEC filed charges against Ripple, CEO Brad Garlinghouse and executive chairman Chris Larson, alleging they used unregistered securities to raise funds in December 2020. The commission has issued a notice that it intends to drop the charges against Garlinghouse and Larsen in October 2023, but will continue to work on the case with the crypto firm.
Ripple's trial with the SEC is scheduled to begin in April. The commission has filed enforcement actions against other major US exchanges, including Coinbase and Binance. Ripple's chief legal officer Stuart Alderotti referred to the SEC as an “out-of-control regulator” due to its stance on crypto.
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