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- An ex-SEC lawyer claims the unsealed filings from the DOJ could signal the end of Binance.
- He noted the DOJ has mobilized a full spectrum of observers to prosecute financial fraud against Binance potentially.
- Besides, the SEC has moved to incorporate facts from the DOJ’s agreement to strengthen the ongoing lawsuit against Binance.
Recently, former chief of the SEC Office of Internet Enforcement, John Reed Stark, raised alarm bells regarding the future of Binance. He stated that newly unsealed filings from the U.S. Department of Justice (DOJ) could signal the end of the popular crypto exchange.
Breaking News: A Binance Double Whammy. 1) Newly Unsealed US DOJ Filings Could Mean the End of Binance; and 2) SEC Files Supplemental Pleading Against Binance, Strengthening the SEC Binance Lawsuit Exponentially There’s been a flurry of newly released Binance-related filings… pic.twitter.com/igN2I9Y7cP— John Reed Stark (@JohnReedStark) December 9, 2023
He highlighted the plethora of recently disclosed DOJ filings that bring to light the expansive oversight that the agency now wields over Binance. For instance, the lawyer highlighted that the authority of the DOJ monitor, tasked with overseeing Binance’s compliance, will be under the watch of various divisions within the DOJ.
They include the Criminal Division, Money Laundering and Asset Recovery Sections, National Security Division, Counterintelligence and Export Control Section, and the U.S. Attorney’s Office for the Western District of Washington. This collective effort mobilizes the full spectrum of the DOJ’s capabilities to criminally prosecute financial fraud.
Stark mentioned that Binance, in response to the DOJ’s oversight, is mandated to provide unfettered access to the monitor, allowing scrutiny of its operations, documents, and resources. Also, Binance is obliged to facilitate the monitor’s interaction with various entities associated with the exchange, including former employees, agents, consultants, and joint venture partners.
Meanwhile, according to the lawyer, the intensified scrutiny has strengthened pending litigation against Binance. He noted that the U.S. Securities and Exchange Commission (SEC) has incorporated facts from the DOJ plea agreement into its ongoing enforcement action against Binance.
Specifically, Stark mentioned that in a recent filing, the SEC urged the federal court overseeing the case with Binance to consider admissions Binance made in the DOJ settlement. According to the lawyer, this legal maneuver implies that the SEC is seeking the judge’s acknowledgment of these facts as accurate without the need for formal evidence presentation.
Ultimately, Stark cast doubt on Binance’s ability to undergo a sudden transformation into a conventional, law-abiding, transparent, and government-friendly business. Moreover, he stressed that surviving an audit by the SEC is already a formidable task for Binance. He added that the prospect of enduring an audit conducted by the Department of Justice and the FinCEN appears to be an insurmountable hurdle.
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