San Francisco-based company Ripple has filed its opposition to the U.S. Securities and Exchange Commission's motion for remedies.
Last month, the SEC requested injunctive relief, civil penalties, and disgorgement of profits in the Ripple case. The embattled company, which is best known for its association with the XRP cryptocurrency, might be forced to fork out a whopping $2 billion.
In its motion, the SEC argued that such an exorbitant sum was justified due to the reckless nature of the company's conduct and repeated violations of the securities laws. The massive penalties and fines are supposed to deter Ripple and other industry players from ignoring the laws in the future.
However, in its most recent filing, Ripple argues that the SEC has the burden to come forward with positive proof that the company is going to violate the law again in the future. Furthermore, it argues that its institutional sales did not show "reckless disregard" for the law, citing its interactions with other US regulators and regulatory actions in other major jurisdictions.
Arman ShirinyanThe company claims that any injunctive relief should be "narrow and tailored." Furthermore, according to Ripple, the SEC fails to show that any disgorgement is warranted, arguing that its institutional sales caused no "pecuniary harm." As for the civil penalty, the company claims that it should not exceed $10 million. "The Court should deny the SEC’s requests for an injunction, for disgorgement, and for pre-judgment interest, and should impose a civil penalty of no more than $10 million," Ripple said in the filing.
Ripple's response to the SEC request came at an opportune time. As reported by U.Today, Bloomberg recently revealed that two SEC lawyers were forced to resign after the regulatory agency got sanctioned by a federal judge over its abuse of power in the DEBT Box case. The lawyers misrepresented some crucial facts in order to obtain a temporary restraining order against the Utah-based crypto company.
"The US will be picking up the pieces of the agency’s disastrous policies long after Gensler is gone," Ripple CEO Brad Garlinghouse said on the X social media network.
Arman Shirinyan
Dan Burgin
Vladislav Sopov