The US securities market regulator is now seeking personal financial details or two Ripple executives, Chris Larsen and Brad Garlinghouse, in connection with the illegal $1.3 billion sales of XRP tokens.
The two executives filed a motion within the court asking to drop the subpoenas sent to six banks, seeking the financial records of the two for the last eight years.
The Securities and Exchange Commission (SEC) alleged that the XRP falls under the category of securities, and Ripple failed to register it with the regulator. It named both Larsen and Garlinghouse in the lawsuit filed last December.
According to the lawsuit, both the executives ignored the advice that XRP could be a security and personally profited $600 million from the sales.
However, the request to receive the personal financial details is a ‘wholly inappropriate overreach’ on the part of the regulator as the lawsuit does not involve alleged fraud, the defense representatives argued.
Have You Future Proofed Your Brokerage?Go to article >>
“The SEC has not offered and cannot provide a coherent explanation for why it is entitled to this information,” the defense lawyers said.
Ready to Handover XRP-Related Transactions
Moreover, they highlighted that Larsen and Garlinghouse already agreed to cooperate with the regulator and handover details of all financial transactions related to the XRP sale.
While the US financial regulator was approaching the banks for financial records, both Ripple executives were pushing the court to dismiss the allegations against them in two separate motions filed by their legal representatives.
Both Larsen and Garlinghouse questioned the merits of the lawsuit and pointed out the lack of evidence tabled by the regulator to blame the executives. Furthermore, they questioned the jurisdictional authority of the SEC, saying that all the known XRP sales were conducted outside the United States.