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Binance takes legal action against Forbes and two journalists

Major crypto exchange site Binance retaliates after Forbes published an allegedly defamatory article titled ‘Leaked ‘Tai Chi’ Document Reveals Binance’s Elaborate Scheme to Evade Bitcoin Regulators’. The exchange site recently filed a lawsuit against the renowned media corporation and two of its journalists Michael del Castillo and Jason Brett.

The online article Forbes published on October 29, 2020, revealed that the major exchange site Binance had deliberately planned to escape regulators in the United States by creating a local subsidiary called Binance.US all the while siphoning funds from their US site back to the main company.

The article alleged that the exchange site came up with an elaborate scheme to ‘intentionally deceive regulators’ while ‘potential customers would be taught how to evade geographic restrictions.’

The accusations were based on a leaked slideshow Forbes claims to be written by Harry Zhou, a former Binance employee who is now the founder of a San Francisco-based exchange site co-owned by Binance. According to the slideshow, Zhou came up with a plan to transfer revenue from their US subsidiary straight to the main Binance company while in the guise of complying with the strict US regulations.

Binance founder and CEO Changpeng Zhao or more commonly known as CZ, reacted in a series of tweets on the day of publication saying that the statements and accusations in the articles were incorrect. ‘Binance has always operated within the boundaries of the law,’ CZ further claims, refuting the article and all of its content.

The crypto billionaire adds that his company has always approached every location with proper licensing and applications, making sure that they are well within the boundaries of the law. By collaborating with notable law enforcement agencies, Binance never fails in ensuring their operations comply with the law especially when setting up international subsidiary exchange sites in countries such as the US, Singapore and the UK.

However, Binance’s reaction to the report does not stop at their CEO’s remarks. Twenty days after the article was published, Binance officially filed a lawsuit in the United States District Court of New Jersey against Forbes Media and the two crypto journalists who wrote the article, Michael del Castillo and Jason Brett. The Malta-based exchanged site alleges that the article was defamatory and has caused millions of dollars in losses. In response, Binance is demanding compensatory and punitive damages from the media group.

In the filed complaint, Binance declares that ‘The Story contains numerous false, misleading and defamatory statements about Binance.’ They deny the allegations of the Tai Chi document saying that the leaked slideshow and the contents within were not created in Binance nor by any of its current or ex-employees.

Aside from the defamatory allegations, Binance also included in their complaint that the company has suffered material damages believed to be in millions of dollars due to the article’s publication. Proving material harm was done is a strategy in winning defamation suits. They recently retained the services of Charles Harder, an attorney popularly known for representing successful clients such as Hulk Hogan and taking down another conglomerate Gawker Media.

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