CFTC sues Binance and cofounder Changpeng Zhao for allegedly violating trading rules

• Binance and CEO Changpeng Zhao are being sued by the CFTC for allegedly violating trading rules.
• Among the allegations, the CFTC said Binance solicited US customers without registering under US law.
• The CFTC is asking that trading bans are placed on the exchange, as well as financial costs.

The Commodities Futures and Trading Commission sued Binance — as well as cofounder and CEO Changpeng Zhao and former Chief Compliance Officer Samuel Lim — for allegedly violating trading rules.

In a complaint filed in federal court Monday, the regulator listed eight provisions of the Commodity Exchange Act that it claims were breached.

Zhao and Lim solicited US customers, especially "lucrative and commercially important 'VIP'" ones, while ignoring requirements to register under US registration law, it said.

Binance further helped customers avoid its own access controls and evade its "ineffective compliance program."

Binance did not immediately respond to a request for comment.

The CFTC filing is requesting the court to place monetary costs onto the exchange, as well as trading and registration bans.