The Securities and Exchange Commission (SEC) has accused Changpeng ‘CZ’ Zhao, CEO of Binance, and Guangying ‘Helina’ Chen, the firm’s financial manager, of redirecting billions of dollars in customer funds through an intermediary holding company, Key Vision Development Limited​
The allegations are based on testimony provided by Sachin Verma, an accountant employed by the SEC. The regulator intends to use this evidence to request a temporary restraining order freezing assets held by Binance.US.
The court filing questions why a Zhao-controlled entity, supposedly using personal funds on the Binance.US platform, acted as a conduit for billions of dollars belonging to Binance customers. Verma’s forensic analysis of bank statements reveals that $12 billion was sent to Zhao and $162 million to a company controlled by Chen in Singapore.
The SEC states that a majority of the funds sent to Zhao and Chen now reside in offshore accounts. Notably, Chen, who serves as Binance’s back office and financial manager, allegedly controlled accounts belonging to Binance.US, contradicting the unit’s claimed independence. Binance has vehemently denied commingling customer deposits with company funds, asserting that CZ’s trading vehicle, Merit Peak, is used for his personal wealth.
The Securities and Exchange Commission (SEC) has been conducting an investigation into Binance.US since at least 2020, and the regulatory body now alleges that Binance maintained custody of its U.S. affiliate’s assets until December 2022. This revelation comes despite Binance’s assurances to regulators and the public that the two entities were completely independent.
Also Read: US Court Issues Summons to Binance CEO Following SEC Complaint
