Tag: securities and exchange commission

Binance Reportedly Saw Monthly Illegal Crypto Transactions Worth $90 Billion in Banned China Market

Binance users traded $90 billion (roughly Rs. 7,42,800 crore) of cryptocurrency-related assets in a single month in China, where cryptocurrency trading has been illegal since 2021, the Wall Street Journal reported on Tuesday citing internal figures and current and former employees of the exchange.

The transactions made China Binance’s biggest market by far, accounting for 20 percent of volume worldwide, excluding trades made by a subset of very large traders, the WSJ said. The newspaper did not specify the month during which the transactions were made.

Binance’s origins lie in China, though the world’s largest crypto exchange withdrew from mainland China in 2017 during a regulatory crackdown. It did not immediately respond to a Reuters request for a comment on the Journal report.

“The Binance.com website is blocked in China and is not accessible to China-based users,” a company spokesman told the WSJ.

The exchange has also been under the scrutiny of US regulators like the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).

The CFTC sued Binance for operating what it said was an “illegal” exchange and a “sham” compliance program, while the SEC sued Binance and CEO Changpeng Zhao saying that Binance artificially inflated its trading volumes, diverted customer funds, failed to restrict US customers from its platform and misled investors about its market surveillance controls.

The exchange is also under investigation by the US Justice Department over possible money-laundering and sanctions violations, Reuters has reported.

© Thomson Reuters 2023

Samsung launched the Galaxy Z Fold 5 and Galaxy Z Flip 5 alongside the Galaxy Tab S9 series and Galaxy Watch 6 series at its first Galaxy Unpacked event in South Korea. We discuss the company’s new devices and more on the latest episode of Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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Coinbase Sues SEC for Response on Months-Old Petition Seeking Clarity on Regulation of Crypto Sector

Coinbase, one of the world’s largest crypto exchanges, has sued the US Securities and Exchange Commission (SEC) to clarify rules surrounding the growth of crypto businesses in the US. The crypto exchange has asked a US court to compel the SEC to provide detailed information to allow crypto companies to plan and develop their operations. This move comes months after Coinbase asked the SEC for clarity on crypto rules after the regulator opened investigations into the business activities of the crypto exchange.

In July 2022, Coinbase in July 2022 filed a petition asking the SEC if it would use its official rulemaking process to provide guidance to crypto players. This legal action is a follow-up to Coinbase’s petition to the US SEC seeking clarity.

“Coinbase filed a narrow action in federal court to compel the SEC to respond yes or no to our July 2022 petition asking the SEC to use its formal rulemaking process to provide guidance for the crypto industry. The Administrative Procedure Act (the APA) requires the SEC to respond to Coinbase’s rulemaking petition ‘within a reasonable time’,” Coinbase wrote in a blog post.

The exchange says that over the last nine months, over 1,700 entities have submitted comments to Coinbase’s petition. If the SEC responds with a no to Coinbase’s petition, then the crypto exchange would have an option to challenge that decision in court and pitch the need for clear crypto guidelines in the US.

“It’s important for the SEC and any other agency petitioned for rulemaking to respond to the petition once the agency has made up its mind, especially if the answer is no – otherwise the public can never exercise its right to ask a court if the agency’s decision was proper. From the SEC’s public statements and enforcement activity in the crypto industry, it seems like the SEC has already made up its mind to deny our petition. But they haven’t told the public yet. So, the action Coinbase filed today simply asks the court to ask the SEC to share its decision,” the blog added.

In March this year, the SEC threatened to sue Coinbase Global over some of the crypto exchange’s spot market as well as its Earn, Prime and Wallet products. Coinbase’s step to get the SEC to make its decision on its petition is being seen as a reaction to the SEC’s threat to probe the crypto firm.

Xiaomi launched its camera focussed flagship Xiaomi 13 Ultra smartphone, while Apple opened it’s first stores in India this week. We discuss these developments, as well as other reports on smartphone-related rumours and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
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Florida’s ‘Mother Teresa’ accused of Ponzi scheme

A South Florida woman known as “Mother Theresa” in her community has been accused of running her business as a lucrative Ponzi scheme that scammed close to $200 million.

Johanna M. Garcia, of North Lauderdale, allegedly defrauded over 15,400 investors of up to $196 million through her company, MJ Capital Funding LLC, NPR reported Tuesday.

Founded in 2020, MJ Capital pledged to connect investors with small businesses through “merchant cash advance,” or MCA. 

Described as a “hardworking woman that has her priorities in line” in her company bio, Garcia boasted of being a down-to-earth businesswoman who helped regular people generate wealth– she was even “referred to as ‘Mother Theresa’ [sic] in her community.”

The ruse started to fall apart in April 2021, when a website emerged accusing MJ Capital of running a Ponzi scheme.

Garcia sued the anonymous whistleblower for defamation and continued to collect money from investors through Aug. 2021, when the Securities & Exchange Commission filed a formal complaint against the company.

In the document dated Aug. 9, the SEC alleges that MJ Capital used investors’ cash to fund “outside annualized ‘returns’ of 120%-180%,” while company higher-ups squirreled away investments for personal excursions and luxury goods.

In addition to using new injections of money to satisfy existing investors, the SEC claims that MJ Capital used unlicensed brokers and sales agents to sell unregistered securities.

A federal judge responded to the filing by freezing Garcia’s corporate assets and ordering them into receivership.  

While Garcia awaits further investigation, the case against MJ Capital got new fodder last Tuesday, when the SEC filed a second complaint against Pavel Ruiz, a company board member. 

The SEC argues that Ruiz, 29, played a “significant role in perpetuating the Ponzi scheme.”

Armed with a team of around 70 sales agents, Ruiz allegedly defrauded over 5,100 investors of at least $46 million, $7.7 million of which he diverted into his personal accounts.

According to the SEC, Ruiz used some of the pocketed money to purchase a luxury car and crypto assets.  

The same day as the SEC complaint was released, the U.S. Attorney’s Office in the Southern District of Florida charged Ruiz with conspiring to commit wire fraud.

It is unclear if Garcia, who was not named in the federal case, will face similar charges as well.

If convicted, Ruiz faces up to 20 years in prison. 

As of last week, both Garcia and Ruiz had reached partial settlements with the SEC, delaying monetary penalties until the conclusion of any criminal proceedings.

Ruiz is currently free on $250,000 bond.

The MJ Capital scandal is merely the latest in a disturbing string of similar cases, some of which saw investors scammed out of hundreds of millions of dollars.

In March this year, the Post reported on the crackdown on a $300 million Ponzi scheme that ended with FBI gunfire in Las Vegas. Just last month, the SEC filed a complaint against 11 people for their roles in an elaborate crypto pyramid scheme that targeted retail investors.

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