SEC suit includes testimony from Binance.US’ ex-CEO in 2022.
The former CEO of Binance.US, Catherine Coley, known as “BAM CEO A” in the lawsuit filed by the US Securities and Exchange Commission (SEC) on June 5, has maintained a low profile since her departure. However, she provided testimony to the SEC in 2022 during its investigation of the company for insider trading.
Her testimony from 2022 has resurfaced as an exhibit in the SEC’s new case against the cryptocurrency exchange. Coley’s testimony was apparently quite lengthy, with page numbers ranging from 135 to 336 in the selected passages that constitute Exhibit 86 in the June 6 case. These passages mainly concern the separation of Binance and Binance.US, which was the subject of major allegations in the SEC suit.
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Coley served as the CEO of Binance.US from its founding in 2019 until her resignation in 2021. As recounted in the SEC suit, Binance CEO Changpeng Zhao, also known as “CZ,” was involved in Coley’s hiring, but she quickly became frustrated with Binance.US’ lack of independence. The suit quotes her from the 2022 testimony:
“I wanted full independence of everything, but that wouldn’t necessarily be possible or be possible at that time, given our reliance on some of those components [in four service-level agreements with Binance.com].”
The service-level agreements between Binance and Binance.US were a Master Services Agreement, a Wallet Custody Agreement, a Software License Agreement, and a Trademark Agreement.
Catherine Coley has entered the chat https://t.co/zgTZEqY9Nn
— DIRTY BUBBLE MEDIA: GRIND SLOW, GRIND FINE (@MikeBurgersburg) June 7, 2023
The wallet agreement particularly bothered Coley, who testified in 2022, “The wallet and custody was one that I wanted to have, at least U.S. participation in so that we would have control over the custody of the tokens.” Trading data was covered by the agreements. “I wanted custody of the data and ability to interact with the raw data in real-time,” she said.
The suit quotes Coley from internal communications in addition to the 2022 testimony. These include her references to Binance.US’ efforts to receive more independence as “Project 1776” and a blunt interaction about wash trading.
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