Binance and its founder Changpeng Zhao are being sued by the Commodity Futures Trading Commission for numerous alleged violations of the Commodity Exchange Act and CFTC regulations, the Associated Press reported. Binance’s former chief compliance officer, Samuel Lim, was also charged with aiding and abetting Binance’s violations. In its complaint, the CFTC claimed that cryptocurrency exchange giant Binance “allegedly chose to knowingly disregard applicable provisions of the CEA while engaging in a calculated strategy of regulatory arbitrage to their commercial benefit.” For example, Binance did not require customers to provide any identity-verifying information. It also communicated with U.S. customers using a messaging platform that automatically deleted written communications. The CFTC filed the complaint Monday in the U.S. District Court for the Northern District of Illinois. It is seeking disgorgement, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the CEA and CFTC regulations.
