Binance and CZ face potential 'criminal penalties' if found guilty of securities fraud.
With the U.S. Securities and Exchange Commission (SEC) filing a lawsuit against Binance, its domestic expansion is now facing significant obstacles. As the possibility of criminal penalties for Binance in the U.S. is being discussed, South Korean financial authorities, currently reviewing the executive change report for Gopax (which Binance acquired), are closely monitoring the situation.
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Hyeonsu “Elliot” Jin, managing partner at Decent Law Firm, explained, "Binance is accused of engaging in wash trading, commingling customer assets with corporate funds (potentially embezzlement), and illegally raising funds through the issuance of its own coins (BNB, BUSD) (fraud charges). This makes it criminally problematic, unlike Coinbase." However, Jin added, "Dropil was a case where there was intent to defraud investors from the beginning, but it's unclear in what specific way Binance deceived investors."
