Binance, CEO Changpeng Zhao Intend to Dismiss CFTC Complaint

Crypto exchange Binance and its CEO Changpeng “CZ” Zhao are planning to file a motion to dismiss the lawsuit filed in March from the United States commodities regulator.

on july 24 Admission Several Binance entities, Zhao and former chief compliance officer Samuel Lim said they plan to file two separate motions to dismiss the complaint before July 27 in the Illinois District Court.

“The Foreign Binance Entities and Zhao intend to file a joint motion to dismiss the complaint. Lim intends to file a separate motion to dismiss the complaint, and incorporate portions of the motion filed by the Foreign Binance Entities and Zhao,” the filing states.

Binance is also seeking permission to exceed the 15-page limit in the brief that will be used to support its proposal and has requested to increase it to 50 pages, citing the complexity of the lawsuit brought against it.

“Given the complexity of the CFTC’s complaint and the number of arguments defendants will make in support of their motions to dismiss, defendants anticipate that their memorandum of law in support of both motions will exceed the fifteen-page limit.”

The Commodity Futures Trading Commission (CFTC) sued Binance and Zhao in March alleging that the crypto exchange had not properly registered with the regulator.

The CFTC claimed that despite Binance barring US residents from transacting on its platform since at least 2019, it knowingly traded multiple cryptocurrencies for persons based in the US and knowingly violated US laws.

The regulator also called Binance’s compliance process a “sham”, alleging that it voluntarily conducted its activities outside the US and obscured the location of its headquarters with the aim of evading US regulations.

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The Securities and Exchange Commission (SEC) also sued Binance and Zhao on June 5, alleging that it sold unregistered securities, allowed US customers to use its global platform, and claimed that Zhao misappropriated customer funds.

The SEC complaint claims that in 2018 Binance’s head of compliance – believed to be Lim – said in a message to another compliance officer that “we are operating as an unlicensed securities exchange in the United States, bro.”

Binance is also under investigation by the US Department of Justice for allegedly allowing Russians to use its platform in violation of US sanctions.

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