SEC Pursuing $102.6 Million Penalty from Ripple, Rejects $10 Million Proposal
The U.S. Securities and Exchange Commission (SEC) has responded to Ripple Labs’ request for a reduced penalty in the ongoing XRP case. Ripple had suggested a more modest fine of $10 million, using the Terraform Labs settlement as a basis for comparison. Initially, the SEC had sought a staggering $2 billion in penalties from Ripple.
In a letter to District Judge Analisa Torres dated June 14, the SEC highlighted that the comparison to the Terraform settlement was flawed. While Terraform Labs, which is in bankruptcy, had agreed to burn the keys to its crypto asset securities, return funds to investors, and remove certain board members, Ripple had not agreed to any similar actions.
The SEC pointed out that settlements where financially strapped defendants quickly return funds to victims and cease illegal activities voluntarily are not comparable to cases involving wealthy defendants like Ripple who continue to profit from similar violations. The SEC emphasized that Ripple’s proposed $10 million penalty was inadequate to serve as a deterrent.
The SEC also addressed Ripple’s argument that the penalty should be based on a percentage of gross sales, pointing out that comparing it to gross profit would result in a much higher figure. As a result, the SEC is seeking a $102.6 million penalty from Ripple, rejecting the $10 million proposal as insufficient to fulfill the objectives of civil penalty statutes.
What are your thoughts on the SEC’s pursuit of a $102.6 million penalty against Ripple? Feel free to share your opinions in the comments below.
