Binance to face the music in Canada following a class action lawsuit against the crypto platform for violating the Ontario Securities Act (OSA). But this has left the exchange surprised for two reasons. Why are the courts coming now even after shutting down operations in the region? Besides, Binance is also persuaded that being authorized as a money-transmitting business allows them the right to operate in Ontario.
Related: Crypto Kids Gone Wild: Canadian Teens Steal $4.2M as Coinbase Support
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Here is what we have in our latest piece:
- Binance Woes in Canada
- The Latest Lawsuit against CEX Platforms
- The Ontario Securities Commission, Binance should pay for damages
- Why poke your nose in my stuff, yet I left your hood?
Law enforcement in Canadian Province Ontario are like no dude. You might have left but not so fast! Apparently, the most grievous act you committed here is leaving without bidding us adieu.
Binance Exchange Broke Ontario Securities Commission Laws
Binance will face a class action lawsuit for violating securities laws in Canada. A new certification motion by the Superior Court of Justice alleges that the leading exchange sold derivatives to retail traders without securing proper licensing. Plaintiffs Jeremy Leeder and Christopher Lochan said the selling of unregistered derivatives violated the OSA. As such, the lawsuit is asking Binance to desist its operations in the region and to compensate for damages.
The cryptocurrency exchange has dominated the scene accounting for over half the total spot market across all centralized exchanges. Besides, the platform also leads with the largest derivatives market followed by Bybit, OKX, and other exchanges. The latest lawsuit against the exchange comes several months after Binance ceased its operations in Ontario back in June 2021. However, the new allegations claim the exchange failed to announce the cessation of sales. The motion goes on to read that the OSC informed the accused of intentions to secure a cease trade order as early as 2022.
Binance Should Have Left Us Alone in 2021
The Ontario Securities Commission (OSC) conducted regulatory scrutiny of the crypto industry in 2021 and forced Binance to cease operations in the Canadian province. Binance heed to the cease orders by winding down operations. However, the OSC states the exchange dragged the closing of its operation till 2022. Meanwhile, the crypto trading platform had a change of mind and rescinded the order. The exchange claimed its money service business authorization allowed it to continue operating in Ontario. Another argument represented Binance merely as a middle party that facilitates transactions between investors and offerings. However, the court rejected this statement claiming the only transactions happening via the crypto portal were contracts between it and investors.
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This new motion comes a few days after Kenyan authorities arrested Binance executive Nadeem Anjarwalla who has been considered a fugitive in Nigeria. Talks are still ongoing between the Kenya Police, the Economic and Financial Crimes Commission (EFCC) in Nigeria, and Interpol about the extradition process for the Anjarwalla.
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