In a court filing dated September 14, the United States Securities and Exchange Commission (SEC) accused Binance.US of non-cooperation in the ongoing investigation against the cryptocurrency exchange.
In its court filing, the SEC noted that BAM, the holding company for Binance.US, has produced only 220 documents during the discovery phase. Numerous documents submitted under the Consent Order “consist of unintelligible screenshots and documents without dates or signatures.”
“It has responded to requests for relevant communications with blanket objections and has refused to produce documents kept in the ordinary course of its business, claiming those documents do not exist, only for the SEC to later receive such documents from other sources.”
The SEC also expressed concern regarding Binance.US’s use of Ceffu, the wallet custody software offered by Binance Holdings Ltd. The SEC observed that BAM’s statements regarding Ceffu’s and Binance’s involvement in the wallet and customer funds management needed to be more consistent.
SEC stated that BAM initially claimed Ceffu was its wallet custody software and services provider but later claimed Binance was its provider. The regulators expressed concern that the cryptocurrency exchange’s use of Ceffu violates a prior agreement to prevent diverting funds overseas.
On June 5, the SEC filed a lawsuit against Binance, leveling 13 accusations, including unregistered securities offerings, the Simple Earn and BNB Vault products, and its staking program.
Binance.com, Binance.US, and BAM Trading, according to the SEC, should have registered as clearing agencies, broker-dealers, and exchanges, respectively. BAM Trading was required to register as a broker-dealer due to the unregistered offer and sale of Binance.US’ staking-as-a-service program.
The most recent allegations made by the SEC against Binance.US coincide with an internal crisis at the exchange. The Binance exchange.US CEO Brian Shorder joined the list of top Binance executives who have left the company this year, followed within days by the exchange’s director of legal and chief risk officer.