SEC: Ripple’s bid to hide financial data in remedies briefing ‘unlawful’ SEC: Ripple’s bid to hide financial data in remedies briefing ‘unlawful’
The SEC argued that the information Ripple is looking to conceal ought to be made public.
2 min read
Updated: May. 21, 2024 at 12:37 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The US Securities and Exchange Commission (SEC) has objected to Ripple’s attempt to redact evidence in their remedies briefing, according to a court filing on May 20.
While the SEC acknowledges Ripple’s right to seal certain exhibits, it argues that Ripple’s move to conceal financial and securities sales information is unlawful. The SEC contends that these details are crucial to the requested remedies.
The SEC stated:
“Ripple has now been adjudicated to have sold investment contracts without registering these sales or making the disclosures required to do so. Yet, Ripple persists in trying to conceal the very information that it legally would have had to disclose to sell those securities.”
SEC wants Ripple business information in public
The Gary Gensler-led Commission argued that Ripple should have publicly disclosed the financial information and pricing it now seeks to conceal.
According to the agency, the law requires the disclosure of 32 categories of information in a registration statement, including an audited balance sheet showing the issuer’s assets and liabilities, three years of audited profit and loss statements, and offering information such as estimated net proceeds, pricing, discounts, expenses, and details of prior offerings.
Consequently, the SEC said that Ripple cannot claim harm from disclosing information that it is legally required to disclose.
The SEC further pointed out that Ripple could not argue away these disclosures under the claim that it is a private company because
“it has traded its privacy interest in the information required to be disclosed by the securities laws for the ability to raise money publicly. When a company makes that choice, Congress has deemed the disclosure of that information to be in the public’s interest.”
Meanwhile, this SEC’s partial opposition is the latest development in the ongoing case against Ripple. With the case nearing its conclusion, the financial regulator is seeking a $2 billion fine against the crypto company.
However, Ripple has countered this request, calling it baseless and advocating for a penalty not exceeding $10 million.
Notably, Ripple, in its first-quarter report for this year, stated that it remains confident that the judge will approach the remedies phase fairly.
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In this article
The XRP Ledger is a decentralized cryptographic ledger powered by a network of peer-to-peer servers.
Ripple
Ripple is a US-based technology company which develops the Ripple payment protocol and exchange network using XRP, the digital asset native to the XRP Ledger.
Gary Gensler is an American government official and former investment banker who President Joseph Biden nominated to chair the U.S.