John Reed Stark, a former SEC officer, tweeted there exists a litany of indicators that US DOJ will file, or has already filed under seal, a Binance-related criminal indictment. The CFTC and SEC complaints read more like criminal indictments, replete with allegations of fraud, deception, obstruction of justice and money laundering.
The CFTC filed a 76-page complaint against Binance, charging its CEO Changpeng Zhao, three Binance entities, and the former chief compliance officer with multiple violations of CFTC statutes. The complaint alleges fraud, deception, obstruction of justice, and money laundering. It claims that Binance's former chief compliance officer knew about customers engaged in illicit activities and helped them evade compliance controls.
Likewise, the SEC filed a 136-page complaint, accusing Binance entities and Zhao of commingling billions of dollars in customer funds and secretly diverting them to another company controlled by Zhao. The SEC alleges market manipulation, conflicts of interest, and lack of disclosure, among other violations.
Both the CFTC and SEC complaints point towards criminal conduct, prompting speculation that the DOJ will pursue further charges related to money laundering. The agencies' evidence suggests deliberate attempts to avoid regulation and facilitate illicit activities.
The SEC states in its Memorandum of Support that, “It has also been widely reported that Binance and Zhao are under investigation by criminal authorities in the United States." The SEC is obviously working with criminal prosecutors and FBI agents but reveals no other information.
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Policy and Regulation
Binance
