Bitget App
Trade smarter
Buy cryptoMarketsTradeFuturesEarnWeb3SquareMore
Trade
Spot
Buy and sell crypto with ease
Margin
Amplify your capital and maximize fund efficiency
Onchain
Going Onchain, without going Onchain!
Convert
Zero fees, no slippage
Explore
Launchhub
Gain the edge early and start winning
Copy
Copy elite trader with one click
Bots
Simple, fast, and reliable AI trading bot
Trade
USDT-M Futures
Futures settled in USDT
USDC-M Futures
Futures settled in USDC
Coin-M Futures
Futures settled in cryptocurrencies
Explore
Futures guide
A beginner-to-advanced journey in futures trading
Futures promotions
Generous rewards await
Overview
A variety of products to grow your assets
Simple Earn
Deposit and withdraw anytime to earn flexible returns with zero risk
On-chain Earn
Earn profits daily without risking principal
Structured Earn
Robust financial innovation to navigate market swings
VIP and Wealth Management
Premium services for smart wealth management
Loans
Flexible borrowing with high fund security
Binance Redirected $12B to Firms Controlled by CEO Changpeng Zhao, SEC Says

Binance Redirected $12B to Firms Controlled by CEO Changpeng Zhao, SEC Says

CoindeskCoindesk2023/06/08 17:36
By:Sam Reynolds

SEC says billions in customer funds were directed to Zhao’s firm Merit Peak via a holding company called Key Vision Development Limited.

Changpeng Zhao, commonly known as "CZ", founder and CEO of Binance, at Davos in 2023. (Casper Labs)

Binance CEO Changpeng ‘CZ’ Zhao, and Guangying ‘Helina’ Chen, received billions of dollars of customer funds through their holding company, .

The funds were sent to firms controlled by Zhao via an intermediary holding company known as Key Vision Development Limited, the SEC said.

The evidence for these allegations comes via testimony delivered by Sachin Verma, an accountant employed by the SEC, which will be used as part of the regulator's arguments to request the court to sign a temporary restraining order to freeze assets on .

“The SEC has been unable to determine why a Zhao-controlled entity that was purportedly trading on the Platform using Zhao’s personal funds would have acted as a 'pass through' account for billions of dollars of Binance Platforms customers’ funds,” the court filing reads.

The SEC alleges, via Verma’s forensic analysis of the bank statements of Binance and Zhao’s web of companies, that $12 billion was sent to Zhao and $162 million to a Guangying Chen-controlled company in Singapore.

Chen and Zhao controlled a number of companies with no obvious connection to Binance in their name, the documents show. The SEC says that the majority of the funds sent to Zhao and Chen are now in accounts “offshore.”

Chen is Binance’s back office and financial manager. A said that she controlled accounts belonging to , a contradiction of the unit’s supposed independence.

Binance has publicly denied mixing customer deposits and company funds, and has said that Merit Peak is a vehicle for CZ to trade his “self-made wealth.”

The SEC has been and alleges that Binance held custody of its U.S. affiliate’s assets until December 2022, despite assuring regulators and the public they were separate entities.

Binance and the SEC have a regarding the restraining order.

Zhao said on that the allegation was "simply false."

In a statement, a Binance spokesperson said the referenced funds were "strictly corporate funds and not user assets."

"Binance’s top priority is protecting user assets, which are held 1:1. These accounts represent revenue received by the business for products provided and/or services rendered," the spokesperson said. "Like every other company across the globe, our revenue is used to cover the operational costs of running our global business. We are globally regulated in 17 countries worldwide and regularly have to optimize corporate account holdings.  These types of transactions are typical of most global corporate entities and are required to ensure we are able to facilitate our products and services in a stable and compliant manner."

UPDATE (June 8, 2023, 17:37 UTC): Adds Binance statements.

Edited by Parikshit Mishra.

97

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Locked for new tokens.
APR up to 10%. Always on, always get airdrop.
Lock now!