Court urges SEC and Binance.US to cooperate

The court declined to compel Binance’s U.S. unit to provide SEC with expanded information regarding the handling of client assets, The Block reports.

Instead, District Judge Zia Faruqi urged the parties to work together.

Earlier the SEC of unwillingness to cooperate in disclosing information. According to the agency, the exchange’s holding company — BAM — was delaying the preparation of the requested documents. The Commission also noted that the platform continues to use custody service Ceffu despite previous arrangements.

Binance.US called the SEC’s requests for documentation “too broad” and “unduly burdensome.”

“I need you all to try to cool it down, forget the past, and try to give me something that, in your view, would help sort this out,” said Zia Faruqi.

The Commission asked the court to compel BAM to provide information on the custody of client assets, the wallet-control system, and the company’s financial reports, including the general ledger.

The SEC was also interested in data on the exchange’s cooperation with Ceffu. In the agency’s view, the custody service is a “recently renamed unit of Binance,” which apparently controls American clients’ assets.

Against the backdrop of the SEC investigations, Binance.US underwent layoffs, and the company’s CEO Brian Shroder left. Following him, the heads of the legal department Krishna Juvvadi and the risk department Sidney Majalya left.

In September, the platform’s daily trading volume fell to $2.97 million. For example, on September 16 the figure stood at $5.1 million versus $230 million a year earlier.

On June 5, the SEC filed suit against Binance and its CEO Changpeng Zhao. The Commission brought 13 charges, including allegations of selling unregistered securities.