In its 13 charges, the SEC alleged that Binance and Zhao used Merit Peak and Sigma Chain, another trading firm controlled by Zhao, to commingle corporate funds with client assets and use the monies "as they please."
This put customers' assets at risk while Binance sought to "maximize" its profits, the SEC wrote in its civil complaint on Monday.
"All user assets on Binance and Binance affiliate platforms, including Binance.US, are safe and secure," it said in a statement on Monday.
The funds received by British Virgin Islands-based Merit Peak between 2019 and 2021 flowed from Key Vision Development Ltd, also controlled by Zhao, the SEC filing on Tuesday showed.
Reuters reported last month that Key Vision and Merit Peak, along with Binance's Cayman Islands holding company, formed the core of the global crypto exchange's financial network.
Persons:
Changpeng Zhao, Binance, Zhao, Guangying Chen, Chen, Tom Wilson, Jane Merriman
Organizations:
U.S . Securities, Exchange Commission, SEC, Sigma, British, Vision Development, Key Vision, U.S, Reuters, Vision, Binance's, Sigma Chain's, BAM, Thomson
Locations:
Seychelles, British Virgin Islands, Islands, Binance, United States, U.S, Singapore