SEC Asks Binance to Ban Transfer of Customer Assets in the United States

Previously, according to former head of internet enforcement at the SEC, John Reed Stark, the US Department of Justice (DOJ) has filed or will file criminal charges against Binance, the world’s largest crypto exchange.

Stark’s opinion came after the SEC sued Binance on June 5, 2023 for violating securities laws. The former SEC official stressed the Commodity Futures Trading Commission (CFTC) lawsuit against Binance, along with the SEC’s most recent complaint, is more like a criminal indictment than an ordinary regulatory action.

Stark said the CFTC lawsuit alleges aiding and abetting misconduct, while the SEC complaint accuses customer funds of mixing and there are allegations of market manipulation.

He also highlighted the SEC is seeking extreme solutions, including freezing assets and repatriating funds.

“Seeking such emergency relief usually means the SEC believes they can convince a judge now that the defendants have committed fraud and investors’ funds are in jeopardy,” the former SEC official wrote in a Twitter post. 2023).

Stark also discusses the evidence presented in the SEC’s accounting declarations and the mix-up of funds and asset transfers he mentions.

“The SEC is clearly working with criminal prosecutors and FBI agents but is not disclosing any other information,” Stark argued.

Stark added that both the CFTC and SEC cases are intensely focused on money laundering, it is a prosecution suite that has been created and reserved for criminal prosecution of the US DOJ in relation to Binance. Stark deduces that the DOJ may also be collaborating with officials on this case.

This is not the first time Stark has warned about enforcement in the crypto sector. In January, Stark insisted the “regulatory attack” was just the beginning after the SEC attacked Gemini and Genesis for their lending platforms.