On December 12, Binance filed two filings in the case against the U.S. Securities and Exchange Commission (SEC), alleging the agency’s actions were improper.
In first filing, the exchange made another bid to terminate the case against the company and its former CEO Changpeng Zhao (CZ).
The filing asserts that the SEC has not presented plausible arguments that various Binance tokens and services are securities or investment contracts.
According to the filing, the regulator’s specific claims regarding the BNB token have expired, and coins more widely distributed outside the United States do not fall under the agency’s jurisdiction.
Moreover, representatives of the company argue that questions about the BNB Vault and Simple Earn services are aimed at an improper application of securities laws.
The SEC’s failure to provide \”fair notice\” of its claims forces a renewed motion to dismiss the suit, Binance added.
The company asked for the suit against Zhao to be dismissed because it cannot prove his ties to American users. The former chief executive’s role in running the company also does not give the regulator jurisdiction to bring charges within its jurisdiction.
In November, CZ pleaded guilty to sanctions violations and anti-money-laundering laws. Binance will pay $4.3 billion under a deal with the U.S. Department of Justice. Zhao also agreed to pay a $50 million fine and stepped down as CEO of the exchange.
However, the Commission did not join this deal, but based on the testimony the agency decided to escalate the already-open case. In the regulator’s view, the court should take account of the new facts in the admissions by the company and CZ, which could give rise to further criminal charges.
Binance challenged this request in the second filing, arguing that the SEC had not amended the complaint, but merely served the company with a court notice.
«Not only is the SEC notice procedurally improper and inadmissible, it does not demonstrate links between the agreement with the Department of Justice and FinCEN and the regulator’s flawed claims against the exchange and Zhao», the filing states.
The filing also outlines numerous other objections in detail. In the trading platform’s view, the guilty pleas by Binance and Zhao merely show that the parties involved violated the Bank Secrecy Act.
The company again clarified that CZ is subject to U.S. laws in the DOJ case, but not in the SEC case. In conclusion, Binance again urged a full dismissal of the proceedings with the Commission.
Earlier, Zhao posted a $175 million bail to stay free, but prosecutors, fearing his flight, opposed that possibility. Later, CZ was barred from leaving the United States until the February 2024 hearing.
Earlier, a district judge in Seattle accepted the guilty plea of the former Binance CEO on charges related to violations of anti-money-laundering laws.