On December 18th, the Australian Securities and Investments Commission (ASIC) took a significant step in protecting consumers by filing legal action against Binance Australia Derivatives. The move comes after the regulator discovered that the crypto derivatives trading platform allegedly misclassified over 500 retail clients as wholesale investors between July 2022 and April 2023.
Misclassification of Retail Clients
The ASIC’s news release stated that by classifying retail clients as wholesale investors, Binance Australia Derivatives stripped them of legal protections afforded to them under Australian financial laws. This move has been deemed ‘woefully inadequate’ by the ASIC, which emphasizes that retail clients are entitled to stronger consumer protections.
What this means for consumers
The alleged misclassification of retail clients as wholesale investors can have severe consequences for consumers. Wholesale investors are typically subject to fewer regulations and are not afforded the same level of protection as retail clients. By classifying them as wholesale investors, Binance Australia Derivatives may have been able to circumvent these regulations.
On December 22nd, Interpol issued a Red Notice for the founder of Hex, Richard Schueler — also known as Richard Heart. The police organization has requested that law enforcement around the world locate and provisionally arrest Schueler in connection with alleged tax fraud and assault of a 16-year-old victim.
Allegations against Richard Heart
The allegations against Schueler include:
- Tax Fraud: Interpol alleges that Schueler evaded taxes on his income.
- Assault: The police organization claims that Schueler assaulted a 16-year-old victim.
Hex Founder Listed on Europe’s Most-Wanted Fugitives List
The Hex founder has also been listed on Europe’s most-wanted fugitives list, where the same allegations of assault and tax fraud are described in more detail. This move highlights the international effort to bring Schueler to justice.
Roman Storm, the co-founder of crypto mixing platform Tornado Cash, has filed a motion with a United States federal judge requesting that his charges be dropped. The motion comes after an appeals court found that sanctions against the platform’s smart contracts were unlawful.
OFAC Exceeded its Authority
The appeals court ruling stated that the Treasury’s Office of Foreign Assets Control (OFAC) exceeded its authority in sanctioning Tornado Cash’s smart contracts. This finding has significant implications for the case against Storm and his co-defendants.
What this means for crypto regulations
The ruling highlights the need for clear guidelines on regulating cryptocurrency platforms. The fact that OFAC was found to have exceeded its authority in sanctioning Tornado Cash’s smart contracts raises questions about the effectiveness of current regulations.
Co-Founder’s Motion
In his motion, Storm argues that the findings of the case against OFAC make it clear that ‘all three counts of the indictment are fatally and legally flawed.’ This move is a significant development in the case, as it challenges the validity of the charges brought against Storm and his co-defendants.
Kim Nam-kuk, a South Korea National Assembly member, faces a six-month jail sentence for allegedly not reporting his entire cryptocurrency holdings to the government. The allegations against Kim include:
- Concealing Crypto Holdings: Prosecutors claim that Kim concealed 990 million won in crypto holdings in 2022.
- Obstructing Review of Assets: Kim is accused of obstructing the National Assembly Ethics Committee’s review of his assets.
Implications for Politicians and Crypto Regulations
The case against Kim highlights the need for politicians to be transparent about their financial dealings. The fact that Kim allegedly concealed his crypto holdings raises questions about the effectiveness of current regulations and the need for stricter guidelines on politician’s financial disclosures.
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