SEC Caught Seeking to Fine Ripple Labs US$2 Billion
Stuart Alderoty, the legal head of Ripple Labs, revealed that the United States Securities and Exchange Commission (SEC) has requested a federal judge to impose a fine of US$2 billion on Ripple Labs. This request was disclosed in a newly released sealed filing that became publicly available on March 26, 2024, local time.
"Instead of faithfully enforcing the law, the SEC remains determined to punish and intimidate Ripple and the industry at large. We believe the Court will take a fair approach to the settlement phase," Alderoty stated through his X account.
Meanwhile, Ripple CEO Brad Garlinghouse emphasized that the SEC's request for a US$2 billion fine is unprecedented as the case "does not involve allegations (let alone findings) of fraud and negligence."
"We will continue to expose the SEC for what it is as we respond to this matter," he added.
Garlinghouse also accused the SEC of acting "outside the law," citing the DEBT Box case. The agency suffered a major setback last week after the judge overseeing the case sanctioned the regulatory body.
An SEC spokesperson declined to comment on the yet-to-be-publicized filing.
SEC and Ripple Legal Dispute
SEC and Ripple have been embroiled in a legal dispute for years. The SEC's lawsuit against Ripple, Garlinghouse, and one of its founders, Chris Larsen, was filed in December 2020, alleging that the company raised US$1.3 billion through the sale of XRP tokens that were not registered as securities.
In July 2023, Judge Analisa Torres ruled that XRP was not a security in the context of sales conducted on digital asset exchanges.
This decision likely contributed to the SEC's move to dismiss charges against Garlinghouse and Larsen in October 2023 with prejudice. Additionally, the regulator is also facing civil lawsuits against other crypto companies in the United States, including Coinbase, Binance, and Kraken.
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