Binance seeks protective order against SEC’s ‘fishing expedition’

Jesse Coghlan4 hours agoBinance seeks protective order against SEC’s ‘fishing expedition’The exchange claims the SEC"s deposition and discovery requests are outside the scope of the regulators lawsuit it filed against Binance.3237 Total views37 Total sharesListen to article 0:00Breaking newsJoin us on social networksBinance has asked a court for a protective order against the United States Securities and Exchange Commission, accusing the regulator of undertaking a “fishing expedition” with its discovery requests.

In an Aug. 14 court filing, Binance argued while it’s worked in good faith with a June court order, the SEC has served overly broad and unreasonable discovery requests that seek “every single document in [Binance’s] possession related to customer assets.”

“BAM has worked in good faith, but the SEC has been steadfast in its belief that the Consent Order gives it carte blanche to investigate every aspect of BAM’s asset custody practices without any discernible limitation whatsoever,” it stated.

The June order allowed for the discovery of Binance"s custody, security and availability of customer assets.  Binance is seeking a protective order against the SEC, claiming that they are conducting a "fishing expedition".https://t.co/NquMV8ShNK— Molly White (@molly0xFFF) August 15, 2023

However, Binance says the requests were inappropriate as its asset custody practices weren’t of concern in the SEC’s suit, adding it handed over information about customer assets and the SEC hasn’t given evidence that customer assets have been misused.

It added the SEC is demanding it produce all communications dating back to November 2022 for “dozens of topics — many of which have nothing to do with customer assets.”

It also took issue with the SEC’s request that the exchange makes six of its employees and officers available for depositions, including CEO Changpeng “CZ” Zhao.Binance fights back! It files a motion for protective order against the SEC, accusing it of a "fishing expedition." The exchange argues that the regulator"s deposition and discovery requests go beyond the scope of the lawsuit filed. #Binance #SEC #cryptonews— Block Savvy (@Block_Savvy) August 15, 2023

The exchange claimed its senior executives “do not have unique firsthand knowledge about the facts surrounding the security, custody, and transfer of customer assets.”

Binance also said it offered the depositions of senior employees with direct responsibility over customer funds, which the SEC seemingly didn’t take.

The protective order sought by Binance would limit the SEC to deposing four exchange employees — not including Zhao or its chief financial officer. It would also stop the SEC from questioning those deposed about matters outside of the order and halt requests for communications about other topics besides customer assets.

Related: Senator Lummis files amicus brief supporting Coinbase’s dismissal motion against SEC

The SEC sued Binance and Binance.US in June alleging it operated an unregistered securities exchange and sold unregistered securities. Zhao was also named as a “controlling person” in the complaint.

Binance also faces a suit from the Commodity Futures Trading Commission, which the exchange is seeking to dismiss.

Update (Aug. 15, 5:56 am UTC): This article has been updated to add more details from the motion for a protective order.

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