Binance CEO Seeks to Dismiss CFTC’s Charges

Binance exchange and its CEO are preparing to file a defense to CFTC charges with hopes that they will be dropped

Leading digital asset service provider Binance, its Chief Executive Officer (CEO) Changpeng ‘CZ’ Zhao and former executive Samuel Lim are making efforts to dismiss the enforcement action levied on them by the United States regulator the Commodity Futures Trading Commission (CFTC). 

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Binance is due to submit its response to the CFTC complaint on July 27 and is also mulling the idea of filing a motion requesting that the court dismiss the charges brought against them a few months ago. 

Binance to File Dismissal Motion

Based on a July 24 filing to an Illinois District Court, “The Foreign Binance Entities and Zhao intend to file a joint Motion to Dismiss the Complaint. Lim intends to file a separate Motion to Dismiss the Complaint, and join parts of the motion filed by the Foreign Binance Entities and Zhao.”

In addition, Binance is seeking approval to exceed the 15-page limit on the brief required to support its motion. The exchange is requesting that the brief be increased up to 50-page citing the complexity of the CFTC lawsuit against the cryptocurrency exchange and the number of arguments the defendants plan to make in support of their motions to dismiss the lawsuit. 

CFTC Levys Binance And Executives With Lawsuit

The U.S. regulator filed a complaint against Binance, CZ and Samuel Lim in March for allegedly conducting unregistered commodity trading in the region as well as failing to supervise the exchange’s operations which is a violation of U.S. laws. More specifically, the CEO of the exchange was indicted for purposefully concealing the locations of its executives’ offices in a bid to circumvent regulation. 

According to CFTC, Binance was helping U.S. customers circumvent the platform’s compliance control by suggesting the use of Virtual Private Networks (VPNs) to mask their location. Again, the regulator claimed that Binance has never registered its platform with the agency and has therefore violated federal laws designed to prevent and detect terrorism financing and money laundering.

SEC Sues Binance With Multiple Charges

Similarly, the Securities and Exchange Commission (SEC) filed a lawsuit against the leading exchange on June 5th. Some of the charges against Binance from the SEC included operating unregistered U.S. financial companies, misleading investors about the companies’ risk management practices, and inflating trading volumes. 

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