The U.S. Securities and Exchange Commission (SEC) has been investigating Binance.US since at least 2020, court filings published late Tuesday show.
In the filings, the regulator detailed evidence hundreds of millions of dollars in profiteering by the crypto exchange.
The SEC on Monday sued Binance’s U.S. and global entities, alongside its CEO Changpeng “CZ” Zhao, alleging that they had operated unregistered securities exchange by allowing people to trade crypto. The regulator has since sought to freeze Binance.US assets.
The agency internally ordered the investigation and designated officials to take testimony on August 17, 2020, said a court filing by SEC lawyer Colby Steele.
“The investigation concerned, among other things, possible violations of the federal securities laws by BAM Trading Services Inc,” Steele said, citing the company which does business as Binance.US.
A further filing by SEC accountant Sachin Verma said BAM Trading had generated $411 million in revenue for a period covering slightly over four years, a period in which he also calculated $225 million in gross profit. As it is not listed on a stock market the company has usually maintained relative secrecy over its financial affairs.
In a statement tweeted on Monday, Binance.US said it had engaged with the SEC in good faith for nearly two and a half years, but added that the lawsuit was “baseless… unjustified by the facts, by the law, or by the Commission’s own precedent."
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