The SEC wants Binance to admit guilt in its own case

Binance Holdings and its former CEO Changpeng Zhao have responded to the United States Securities and Exchange Commission's (SEC) move to include Binance's guilty plea to the Department of Justice (DOJ) in its own legal process.

In a December 12 filing with the U.S. District Court for the District of Columbia, Binance argued that the SEC's attempt to include the $4.3 billion plea and settlement agreement in a subsequent case with the DOJ was procedurally improper and should not be allowed.

The ongoing Binance-SEC legal case began on June 5, 2023, when the agency accused the company of 13 securities law violations, including that Zhao and Binance managed client assets on Binance.US and mixed or transferred client assets.

The DOJ held talks with Binance and its former CEO in November that resolved its investigation into the firm. The settlement requires Binance to pay $4.3 billion in fines and allows the company to continue operating in compliance with US regulations.

Although not formally included in the agreement, the SEC argued that the federal court overseeing the case should take into account the statements and acknowledgments made by Binance and Zhao on November 21.

The SEC argued that the settlements show that Binance was well aware that it operates in the US, serves US customers and uses US trading infrastructure. In its response, Binance argued that the SEC did not show how the resolution with the DOJ was related to any of the SEC's “false claims” against Binance Holdings and Zhao.

In court papers filed on December 12, 2023, Binance argued that the SEC's notice does not substantiate its claims in the lawsuit from June 2023.

“The SEC's notice is short of an impermissible supplement that does not identify a new “jurisdiction” and instead attempts to introduce new factual information and arguments. This alone is reason to ignore it.

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The company said filing a judicial notice is not a substitute for revising a complaint. According to the company, the SEC's attempt to use solutions with other agencies shows that there is a lack of information on the part of the SEC about any relevant regulatory authority.

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