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SEC: Ripple distracts court attention

In a letter addressed to Judge Analyss Torres, the US Securities and Exchange Commission (SEC) said that Ripple is seeking to avoid liability for an unregistered offering of securities by distracting the court’s attention with defense arguments about the vagueness of legal regulations.

According to the fintech company, the term “investment contract” is not sufficiently defined, so it could not understand that its actions violate the rules, and the SEC should have stopped the firm earlier, said the regulator’s lawyer Jorge Tenreiro.

But, according to him, the term was first defined by the Supreme Court in 1946 and has been working for more than 70 years, and the authorities are not obliged to warn industry players about their possible violation of current legislation.

 

“Ripple claims the SEC was unable to provide the firm with due process and opinion because Commission officials allegedly met with industry leaders and did not tell them XRP was a security,” Tenreiro added.

 

Ripple also used a settlement agreement with the Treasury Department, which recognized XRP as a virtual currency, as defense arguments. However, an SEC lawyer stressed that this does not exempt the company from complying with securities laws.

Tenreiro believes that the court should reject the “legally untenable” arguments of the defense of Ripple, so as not to delay the process.

The lawyer will also petition the court to dismiss statements by Brad Garlinghouse and Chris Larsen in response to the amended SEC lawsuit.

Recall that the regulator in December accused the company of selling unregistered securities in the form of XRP tokens in the amount of $ 1.3 billion. The parties questioned the possibility of pre-trial settlement of the claim.

After the SEC was accused, trading in the Ripple token suspended a number of American exchanges, the company was forced to terminate cooperation with the MoneyGram money transfer service from the United States.

Against this backdrop, SEO Ripple said the firm’s Asia-Pacific business was not affected.

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