Binance CEO Charged by SEC for Capital Flight Risk and Commingling Investor Funds
Wow, talk about a hot mess! The Securities and Exchange Commission (SEC) has charged Binance’s Co-founder & CEO Changpeng Zhao with violating US securities laws after an emergency filing was made due to concerns of capital flight. It seems that the $2.2 billion of U.S. customer assets held by Binance is at “significant risk” of being stolen by none other than the company’s founder, Zhao himself.
Curtesy: Google Images
In fact, federal regulators have gone as far as saying that a freezing order must be in place to prevent illicit transfers by Zhao or any Binance entities if they are to safeguard these funds from criminal activity.
This news comes hot off the heels of several interviews given by Zhao discussing his outlook on cryptocurrency following some seriously turbulent weeks in this market space.
Commingling funds
Jeez, looks like someone has been getting caught with their hand in the cookie jar. Lawyers from the SEC have alleged that Binance commingled investor funds with its own, resulting in $420.4 million of illicit gains being made which is pretty impressive…in a bad way.
The problem seems to stem from years of communication between the SEC and Binance and Binance.US’s inability to identify who controls customer assets – oh dear! This lack of clarity appears somewhat dubious given everything that has now come to light.
Pulling strings
Curtesy: Google Images
According to Zhao’s attorneys, the founder himself claims he is not subject to US law but when there are allegations such as these flying around it’s hard not to wonder what kind of power trip this guy might be on.
All jokes aside though, federal law dictates that both Zhao and Binance must comply with any lawful requests put forth by the court regardless of how powerful or untouchable they may seem – oops!
Finger Pointing
The latest filing referred heavily towards Zhao referring him as a “foreign national who has made overt his views that he is not subject to the jurisdiction of this Court”. Pretty bold statement if you ask us…but hey ho!
Binance had previously claimed itself as having no official headquarters making them either extremely savvy business people or seriously disorganised. Come on guys get your act together!
Courier service?
Curtesy: Google Images
To make matters worse, federal regulators want the court to allow them to serve Zhao by emailing his lawyers due to his “pattern of geographical elusiveness”, reporting that it’s difficult for them to identify exactly where he lives. We suggest trying a courier service or a tracking device…they always do wonders!
No comment?
Despite all this talk surrounding criminal activity and illegal profit-making, Binance has remained tight-lipped about its involvement in these scandals – no surprise there then.
You know what they say…if you have nothing good to say…well…
