Former DoJ Prosecutor Hired as Binance Counsel in SEC Lawsuit

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Kendall Day, former white-collar prosecutor at the United States Department of Justice (DoJ) has been hired by leading cryptocurrency exchange Binance Holdings Ltd., as the firm prepares to fight the allegations brought against it by the Securities and Exchange Commission (SEC). The former DoJ lawyer will represent the firm as its counsel in the SEC lawsuit. 

M. Kendall Day’s Biography 

Currently, Day is a partner in the Washington DC office of Gibson Dunn & Crutcher. According to his biography, Day had worked at the DoJ for close to 15 years before moving to his present office. He was the former acting deputy assistant attorney general at the Department of Justice’s Criminal Division. Day also served as the chief of the department’s Money Laundering and Asset Recovery Section.

The role gave him national supervisory authority over money laundering programs in the DoJ. During that time, the scope of his duty were anti money-laundering charges, deferred prosecution agreements and non-prosecution agreements involving financial institutions. He is bringing all these years of experience and expertise onboard the lawsuit.

SEC Sues Binance With Dozens of Charges

The U.S. SEC sued the largest digital asset service provider Binance, its US office and the Chief Executive Officer (CEO) Changpeng ‘CZ’ Zhao at the beginning of the month for a couple of offences.

The 136-page complaint stated that Binance operate unregistered U.S. financial companies, misled investors about the companies’ risk management practises, and mishandled customers’ deposits by co-mingling them and transferring to an external venture owned by CZ. 

Binance was also indicted for flouting Know-Your-Customer (KYC) rules. Along the line, Binance and the SEC decided to reach an agreement and were persuaded by the U.S. District Judge Amy Berman Jackson. One of the terms of this agreement is the creation of new crypto wallets that are not accessible to the other employees of the exchange.

Binance Prepares as Multiple Enforcement Action Hits

The crypto exchange has tried to bolster its legal team since the enforcement action was made. Binance hired George Canellos, a former co-director of enforcement at the SEC.

According to John Reed Stark, a formal official of the SEC, had hinted earlier at a possibility for the crypto exchange to come under the radar of the DoJ for money laundering. As it stands, the agency is investigating Binance. Meanwhile, the Commodity Futures Trading Commission (CFTC) filed a 76-page complaint against Binance, CZ and Samuel Lim for the violation of federal regulation.

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