Key Takeaways
- Binance.US have decided to fight fire with fire.
- They have hired George Canellos, a former Director of Enforcement at the SEC?
- How can Canellos influence Binance’s case?
Binance.US just added George S. Canellos, former Director of Enforcement for the SEC and former co-director of the SEC in preparations for upcoming legal proceedings. But who is Canellos? How would his presence and expertise affect Binance.US’ chances with upcoming litigations?
Who Is George Canellos?
George Canellos is currently a Partner, Global Head of Litigation & Arbitration at Milbank, where he was also a partner from 2003 to 2009. However, between those tenures, Canellos served as the SEC’s Deputy Director of the Division of Enforcement, as well as Director of the SEC’s New York regional office.
During Canellos’ time at the SEC, he set SEC enforcement priorities, and policies, and supervised civil law enforcement efforts, which included investigations, prosecutions, and trials. Among the most notable responsibilities, Canellos had at the SEC was to supervise enforcement cases, such as the insider trading actions against Raj Rajaratnam, many individuals associated with Galleon Management LP, and hedge fund managers associated with S.A.C. Capital, which was the first-ever action against the operator of a “dark pool” trading platform. This list of achievements, accolades, and responsibilities Canellos goes on and on. Not forgetting that he also worked as a federal criminal prosecutor in the US Attorney’s Office for the Southern District of New York.
Canellos Joins Binance.US Legal Team
Seemingly Binance, led by founder Changpeng Zhao are preparing for potential criminal charges to be filed against them by the US federal government. That follows the events of the thirteen lawsuits filed against the crypto exchange and its founder by the SEC, alleging crimes such as evading US regulations, commingling customer funds, and wash trading.
Hiring Canellos may confirm that Binance doesn’t believe that they’ll get out of their legal conundrum any time soon. The former head of SEC’s Office of Internet Enforcement, John Reed Stark tweeted saying “Canellos possesses a rare and remarkably special combination of skillsets — having served as both an SEC prosecutor and a DOJ prosecutor,” adding that “Binance is clearly preparing for a criminal prosecution and continuing to hire the best defense attorneys in the world.”
Binance/DOJ Newsflash:
Binance and CZ just added a uniquely qualified criminal defense all-star lawyer to their legal team: George Canellos, former Chief of the Major Crimes Unit in the U.S. Attorney’s Office for the Southern District of New York and former head of the SEC’s New… pic.twitter.com/lQlkZ6oxYc
— John Reed Stark (@JohnReedStark) June 12, 2023
While Stark expresses his doubts regarding Canellos being able to get Binance and CZ off the hook, saying “I doubt even Ironman, Captain America, and the Hulk could get Binance out from their current perilous legal quagmire,” billionaire and philanthropist, Mark Cuban took to social media to express his criticism against the SEC’s operations and state that not even an army of securities lawyers could sort out the mess.
This is an SEC WEB PAGE about the howey test and tokens that often conflicts with what @SEC_Enforcement has said publicly. It’s worth a read to get more clarity on what may or may not be a security https://t.co/m5E9V0Pd18
Unfortunately none of the elements presented in this… https://t.co/iZ9Gn5SADK pic.twitter.com/kGHgsZkOaH
— Mark Cuban (@mcuban) June 11, 2023
To what extent Canellos can assist in Binance’s case is yet to be known. What is certain is that George Canellos knows the ins and outs of SEC operations, as well as how cases are handled by the DOJ. This renders him very knowledgeable regarding the laws to bring up and the documents to request from the SEC, and DOJ during trials, much like how Ripple requested documents issued by former SEC directors to assist in their case.
SEC In Hot Waters
The SEC is going through issues of its own, with representatives in Congress calling for a bill under the name of the SEC Stabilization Act. The bill calls for the restructuring of the SEC, including the dismissal of Chair Gary Gensler from his leadership position.
House Majority Whip Tom Emmer stated that “American investors and industry deserve clear and consistent oversight, not political gamesmanship. The SEC Stabilization Act will make common-sense changes to ensure that the SEC’s priorities are with the investors they are charged to protect and not the whims of its reckless Chair.”
