Binance.US, the American subsidiary of the group led by Changpeng Zhao, has announced the recruitment of 4 new lawyers, including a former co-director who worked for the Securities and Exchange Commission (SEC) for several years. In this way, Binance prepares its defenses for its future legal confrontation with the American institution.
Binance Responds to SEC by Hiring 4 Lawyers
To face attacks from the Securities and Exchange Commission (SEC), Binance is preparing its defenses by calling on the most qualified professionals in the United States. Its American subsidiary, Binance.US, has hired 4 lawyers through the international law firm Milbank. Among them, George Canellos, former co-director of the SEC within the “enforcement” division.
Now Global Head of Litigation and Arbitration at MilbankGeorge Canellos previously headed 1,300 attorneys for the SEC. Its teams have notably investigated hedge fund managers and cases of insider trading.
Therefore, according to John Reed Stark, former director of the SEC’s Internet department, George Canellos knows the field of financial regulation very well. His skills will be essential to arm Binance in its conflict with the American regulator:
“Canellos has a rare and remarkably special combination of skills – having served as both an SEC prosecutor and a DOJ prosecutor. »
As for the other three lawyers, they have several years of experience in various fields:
- Matthew Laroche, specialist in issues concerning cybercrime, corruption and money laundering;
- Adam Fee, subject matter experts on terrorism and narcotics. Like Matthew Laroche, he spent several years as an Assistant United States Attorney for the Criminal Division of the Southern District of New York;
- Andrew LeBlanc, bankruptcy litigation attorney.
As a reminder, the SEC has launched legal action against Binance for securities fraudas well as for letting its US customers use the Binance platform instead of its subsidiary Binance.US.
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SEC – What are the risks for Binance.US?
The company founded by Changpeng Zhao has been in the spotlight for a week. After the official announcement by the SEC, statements against the exchange multiplied. After his indictment, a report has come to shine a light on the financial management of Binance and Binance.USwhose client funds were reportedly mixed between 2019 and 2020.
On the night of June 8-9, 2023, following actions taken by the SEC, Binance.US finally announced the suspension of dollar deposits on its platform, as well as the closure of withdrawals in fiat currencies as of June 13. At the same time, the American regulator requested the freezing of the assets held by the American subsidiary.
The impact of SEC complaints doesn’t stop at Binance.US’ gates: its parent company is experiencing massive withdrawals amounting to several billion dollars. Moreover, its American competitor Coinbase suffered the same fate: Brian Armstrong’s firm was also sued by the SEC for the same reasons as Binance.
However, gray areas remain in this investigation, starting with the relationship between the exchange of Changpeng Zhao and the president of the American institution Gary Gensler. In effect, the latter would have offered his services to Binance in 2019, but his offer was refused. Could Gary Gensler’s stubbornness against Binance be the result of growing resentment? We should know more in the next few weeks.
👉 Also in the news: Republican Warren Davidson files bill to ‘fire Gary Gensler’
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Source: Bloomberg
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Always enthusiastic about new technologies, I gradually moved closer to Web3-related activities during the year 2021. Over time, I wanted to add my stone to the building. It was then that I became an editor, with the aim of explaining cryptocurrency-related topics to as many people as possible.
Timothy Bourbotte
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