Binance.US, operated by BAM Trading Services, has responded firmly to the United States Securities and Exchange Commission (SEC). The SEC had previously made demands for additional details from Binance.US, which the exchange now argues are “unreasonable” and “unduly burdensome.”
Questioning the Scope of SEC’s Requests
Binance.US, through its legal representatives, filed sealed documents on September 12th in opposition to the SEC’s motion to compel. The key contention centers around the SEC’s requests for production and interrogatories. However, Binance.US considers to be “overly broad” and outside the scope of the consent order.
BAM attorneys assert that the SEC’s demand for certainty and the request for depositions of BAM CEO Brian Shroder and CFO Jasmine Lee are “unreasonable.”
They argue that neither Shroder nor Lee have unique knowledge regarding the day-to-day management of customer assets at Binance.US. Instead, they point to other witnesses as better sources of insight into the exchange’s operations. These witnesses include BAM’s Chief Information Security Officer, Erik Kellogg.
Furthermore, the attorneys emphasize that the burden imposed by depositions of Shroder and Lee is disproportionate to the potential benefits. They argue that these depositions do not align with the limited expedited discovery contemplated by the consent order.
Challenging Unsubstantiated Allegations
BAM’s legal team takes issue with the SEC’s allegations of asset diversion. They stated that the regulator lacks evidence to support these claims. They consider the SEC’s allegations to be “misleading and mistaken.”
In addition, Binance.US argues that there is a significant disconnect between the SEC’s “overbroad and abusive approach.” Also, the limited expedited discovery agreed upon in the consent order.
Agreement on Protecting Confidential Information
It’s worth noting that this response from Binance.US came shortly after both parties, the SEC and Binance, agreed to a protective motion. This motion requires the filing of confidential information under seal, restricting access to authorized parties, including the judge, attorneys, plaintiffs, and defendants. The joint motion was submitted on September 11th.
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