In the ongoing legal dispute between Binance Holdings and the U.S. Securities and Exchange Commission (SEC), the former has filed a new submission to the U.S. District Court for the District of Columbia.

Binance, along with its former CEO Changpeng Zhao (CZ), asserts that the SEC’s reliance on its prior settlement with the U.S. Department of Justice (DOJ) and Financial Crimes Enforcement Network (FinCEN) is without merit and procedurally inappropriate in the present case.

Binance Dismisses DOJ Settlement as Irrelevant to Security Violations

Binance Holdings, under the leadership of its former CEO CZ, has been entangled in a legal dispute with the SEC since June 5, 2023. The agency has charged the exchange with 13 counts of securities law violations.

These charges include allegations that Zhao and the company controlled customer assets on Binance.US and engaged in the commingling or diversion of such funds.

The SEC alleges that Binance and Zhao misrepresented trading controls and oversight on the Binance.US platform and operated unregistered exchanges, broker-dealers, and clearing agencies.

In response, Binance has claimed that the SEC’s attempt to incorporate the outcomes of the $4.3 billion guilty plea and settlement agreement with the U.S. Department of Justice is procedurally improper and impermissible.

Binance argued that the regulatory body failed to establish the relevance of the resolutions reached with the DOJ to the SEC’s asserted claims, dismissing them as ‘defective.’

In court documents filed on December 12, 2023, the company contended that the SEC’s notice was procedurally flawed, constituting an impermissible supplemental brief introducing new factual information and arguments without merit.

Binance Challenges SEC’s Reliance on Recent Settlement

Binance also asserted in the court documents that the settlement agreement it reached with the DOJ and FinCEN is not applicable to the charges brought against it by the SEC.

The settlement with the DOJ and FinCEN, which involved paying $56 million in penalties, was not comprehensive in addressing the SEC’s allegations of Binance’s violation of securities laws by offering unregistered securities to U.S. investors.

Moreover, Binance contended that the SEC’s supplementary brief failed to introduce new evidence. As the legal proceedings unfold, all attention is focused on Changpeng Zhao, presently in the U.S. awaiting his sentencing in February 2024.