BAM Trading Services Inc. and BAM Management US Holdings Inc. have filed a motion for a protective order in the ongoing legal battle with the Securities and Exchange Commission (SEC). BAM is the corporate name for Binance.US.
This past June, the SEC filed charges against Binance, and its US-based affiliate, BAM Trading Services Inc., alleging the operation of unregistered national securities exchanges, broker-dealers, and clearing agencies, among other transgressions.
Filed on August 14th, the motion claims that the SEC was provided with “limited expedited discovery” in the action but the SEC has been expansive in its requests for information that “have nothing to do with customer assets.”
To quote the document:
“The SEC has declined BAM’s proposals or to meaningfully limit its requests. The SEC’s position is unreasonable and part of a broader pattern of the SEC abusing the discovery provision of the Consent Order. The Consent Order authorized “limited expedited discovery” on a narrow set of topics—namely, the custody, security, and availability of BAM customer assets. Instead of seeking “limited” discovery, the SEC has spent the past 45 days serving incredibly overbroad and unreasonable discovery requests that seek, on their face, every single document in BAM’s possession related to customer assets. BAM has worked in good faith, but the SEC has been steadfast in its belief that the Consent Order gives it carte blanche to investigate every aspect of BAM’s asset custody practices without any discernible limitation whatsoever.”
BAM complains that the SEC is demanding depositions from executives who do not have unique information surrounding the facts of the allegations.
The attorneys describe the SEC as “conducting a fishing expedition,” describing it as “troubling and inappropriate.”