Binance and Zhao Navigate Legal Waters: Responding to SEC's DOJ Integration

<p>Binance
Holdings and its former CEO, Changpeng Zhao, have responded to the United
States Securities and Exchange Commission's (SEC) move to incorporate Binance’s
admission of guilt to the Department of Justice (DOJ) in its ongoing legal
proceedings.</p><p>Binance
vs. SEC: Unraveling the Legal Battle since June 5, 2023</p><p>The
legal dispute between Binance and the SEC commenced on June 5, 2023, when the
agency accused the company of 13 securities law violations, alleging that Zhao
and Binance mishandled customer assets on Binance.US and improperly redirected
or mixed customer assets.</p><p>In
a filing submitted to the U.S. District Court for the District of Columbia on
December 12, Binance contested the SEC’s effort to include the $4.3 billion
guilty plea and settlement agreement with the DOJ, deeming it procedurally
incorrect and requesting its disallowance.</p><p>In
November, <a href="https://www.financemagnates.com/cryptocurrency/doj-seeks-4b-from-binance-ceo-zhao-might-face-criminal-charges/">the
DOJ reached a separate settlement with Binance and its former CEO</a>,
concluding its investigation into the company. The settlement mandated Binance
to pay $4.3 billion in penalties and permitted the company to continue its
operations while adhering to U.S. regulations.</p><p>While
not formally part of the settlement, the SEC argued that the federal court
overseeing its case should consider the statements and acknowledgments made by
Binance and Zhao in the settlement on November 21.</p><p>The
SEC contended that these settlements indicated Binance's awareness of operating
in the U.S., serving U.S. customers, and utilizing U.S. infrastructure for
transactions. In response, Binance argued that the SEC failed to demonstrate
how the resolutions with the DOJ were relevant to any of the SEC’s “faulty
claims” against Binance Holdings and Zhao.</p><p>In
court documents submitted on December 12, 2023, <a href="https://www.financemagnates.com/tag/binance/">Binance</a> argued that the
SEC's notice does not substantiate its claims from the lawsuit of June 2023. The
company asserted: “The
SEC Notice is an impermissible supplemental brief that identifies no new
'authority' and instead attempts to introduce new factual information and
arguments. This alone is a reason to disregard it.”</p><p>Furthermore,
the company emphasized that presenting a judicial notice is not a substitute
for amending a complaint. According to Binance's statement, the SEC's attempt
to leverage resolutions with other agencies reflects a lack of information
regarding any appropriate regulatory authority on the SEC's part.</p><blockquote><p lang="en" dir="ltr">