SEC Lawsuit: Binance Top Exec Controlled US Subsidiary Bank Accounts

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• Binance top exec Guangying Chen reportedly controlled five bank accounts of its US subsidiary between 2019 and 2020.
• Bank records show that Chen was the “Primary Admin User” of the five bank accounts, including one for American customers’ funds and an account for corporate clients.
• Binance.US has denied Reuters’ report that it commingled user funds with corporate funds in 2020 and 2021, calling it a “conspiracy theory.”

Binance Top Exec Controlled U.S. Subsidiary’s Bank Accounts

Binance top executive Guangying Chen reportedly controlled five bank accounts of its independent U.S. subsidiary between 2019 and 2020, according to bank records reported by Reuters on June 5th. The defunct Silvergate Bank authorized Chen as the “Primary Admin User” of the five bank accounts, which included one that held American customers’ funds and another for corporate clients. During this period, Binance.US staff sought the Chen team’s approval to process payments and cover payrolls, according to company messages cited by Reuters.

Commingling Allegations Denied

Reuters reported that Binance commingled user funds with corporate funds in 2020 and 2021; however, Binance has denied this story, calling it a “conspiracy theory.“ This contradicts earlier claims made by Binance.US that it operates independently from its parent company; when asked about the new information revealed in Reuters‘ report, a spokesperson from Binance said: „We remain confident in our ability to demonstrate compliance with all applicable laws.“

Chen’s Role at Silvergate Bank

Silvergate Bank gave Chen access to their five accounts due to his involvement in managing business operations at BAM Trading Services Inc., which is responsible for operating Binance US, according to an internal document seen by Reuters. Furthermore, emails exchanged between Silvergate Bank representatives confirmed that Silvergate had authorized Chen as an admin user on some of its banking platforms since 2018 – prior to launching BAM Trading Services Inc., whose primary function was operating the U.S.-based exchange platform powered by the global firm Binance Holdings Ltd..

Ongoing Regulatory Battle

The news comes just days after the SEC filed charges against both exchanges – alleging they violated securities law when trading digital assets like Bitcoin (BTC) and Ethereum (ETH). In response to these allegations, Changpeng Zhao (CZ) – CEO of both exchanges – claimed he wasn’t aware of any wrongdoing or any activity related to trading digital assets on either exchange outside Securities Laws regulations: „I am not aware of any activity done on either exchange outside what is legally allowed,“ he wrote in a blog post following the announcement last Friday evening (June 4th).


As regulatory scrutiny continues into cryptocurrency markets worldwide – particularly concerning unregistered sales of securities — it remains unclear whether or not CZ’s statement will be enough for regulators who are actively trying to ensure consumer protection across all financial markets globally — including those involving digital assets such as Bitcoin and Ethereum . It is important for exchanges like these two continue providing transparency regarding their operations going forward if they want to remain compliant with existing regulations while appealing future ones as well