Binance calls SEC’s requests for depositions “unreasonable”

Posted: September 12, 2023

• The information the SEC is seeking is disproportionate to what was requested in the Consent Order, Binance argued.
• The regular has no evidence to prove that Binance has diverted customer assets.

In its latest filing, Binance [BNB] called the Securities and Exchange Commission’s (SEC) latest motion for more details “unreasonable,” “unduly burdensome, and “freewheeling.”

On 12 September, the lawyers for Binance.US filed sealed documents contesting the SEC’s motion seeking additional depositions from Binance.

The defense attorneys argued that the regulator’s requests for production and interrogatories were “overly broad, unduly burdensome,” and “beyond the scope of the consent order.”

The attorneys called the SEC’s demand for depositions of BAM Trading Services CEO Brian Shroder and CFO Jasmine Lee, were “unreasonable.” The information these depositions might bring forth is disproportionate to the request in the Consent Order.

They claimed that the regulator couldn’t prove that any of these individuals are involved in the day-to-day decisions regarding the custody and transfer of assets at Binance.US.

Instead, the crypto firm has provided many other witnesses. The list included BAM chief information security officer Erik Kellogg, who has more information regarding BAM’s operations.

The attorneys also argued that the SEC has no evidence to support its allegations regarding the diversion of customer assets. They claimed,

All the evidence in this matter—including documents, declarations, and sworn deposition testimony—supports BAM’s position that it has custody and control of its digital assets.

Request for confidentiality but such mistrust…

On 11 September, all the concerned parties filed a joint motion. It requested how specific documents or potential evidence would be handled during court proceedings.

The SEC, Binance Holdings Limited, BAM Trading Services Inc, BAM Management US Holdings Inc, and Changpeng ‘CZ’ Zhao filed the protective order. It holds all sides to maintain discovery under seal.

The order meant that confidential or other non-public information needed to be filed as protected materials. It restricted access to such documents to parties like the judge, attorneys, plaintiffs, defendants, and court-approved non-parties.