Ripple CEO Brad Garlinghouse and co-founder Chris Larsen have filed a motion asking the SEC to investigate the activities of several overseas trading platforms.
According to the motion, the SEC should request documents from iFinex (Bitfinex’s parent company), Bitforex, Bithumb, Bitlish, BitMart, AscendEX (formerly Bitmax), Bitrue Singapore, Bitstamp, Coinbene, HitBTC, Huobi Global, Korbit, OKEx, Upbit Singapore, and ZB Network Technology.
In the cover letter, Ripple stressed that the regulator would need the assistance of authorities in the Cayman Islands, Hong Kong, South Korea, the United Kingdom, Singapore, the Seychelles, and Malta.
In December 2020 the agency charged Ripple with unregistered sale of securities disguised as XRP tokens worth $1.3 billion. The SEC later amended the complaint, focusing on the conduct of Garlinghouse and Larsen.
The agency contends that they manipulated the token’s price and sold 14.6 billion XRP for more than $1.38 billion. The sales were allegedly conducted to “public investors,” located “around the world.”
According to the defendants, records obtained from foreign exchanges will show that they did not violate пятый раздел Закона о ценных бумаг 1933 года, which prohibits the sale of unregistered securities on U.S. soil.
Ripple executives noted that XRP token sales were conducted on foreign exchanges, and thus did not fall under SEC jurisdiction.
«In cases of transactions conducted on foreign trading venues, both the offer and the sale of XRP were conducted through the order books of the respective platforms, geographically located outside the United States. The SEC’s failure to prove an offer and sales within the country should be fatal to its claims», — the filing states.
Lawyer Jeremy Hogan stressed that the issue concerns solely the Ripple executives’ damages. If the SEC requests documents and they confirm the defendants’ position, the case will not be closed.
This is the 3rd big issue in the case that we haven’t heard much about. Issues: 1. XRP a Security? 2. Fair Notice? 3. Jurisdiction over transactions? The first two issues are all or nothing — win or lose issues. The jurisdiction issue goes to damages only.
— Jeremy Hogan (@attorneyjeremy1) June 2, 2021
Previously, judge Sarah Netburn denied the SEC’s motion for access to Ripple’s legal counsel records regarding XRP’s legal status.
As reported in May, the judge allowed the regulator to request information about the company under a memorandum of understanding with foreign regulators.
Motion for International Discovery and Memo of Law by ForkLog on Scribd