The US SEC and Ripple Labs have been going back and forth in court over the testimony of a former SEC official William Hinman.
July 12, 2021, | AtoZ Markets – Lawyers representing Ripple and individual defendants, CEO Brad Garlinghouse and co-founder Chris Larsen have written to informed Judge Sarah Netburn that the testimony of William Hinman, ex-head of the financial department at the US Securities and Exchange Commission (SEC) has been postponed until July 19.
Ripple wants to get testimony from a key SEC employee William Hinman
It was originally planned that Hinman would testify on June 30, but then the SEC blocked Ripple's request. The regulator argued that the fintech company was unable to substantiate the need to question someone who "held one of the most senior positions" in the department.
However, Ripple itself claims that Hinman has never been a high-ranking official. Despite this, his testimony, according to Ripple, will play an important role in understanding the regulatory status of cryptocurrencies and XRP.
“Defendants cannot point to a single case where the deposition of an SEC official of Director Hinman’s rank was allowed, nor can they distinguish the many cases where courts quashed the depositions of other similarly-ranked officials,” the SEC said.
If Judge Netburn approves the motion of the SEC, his deposition will not take place.
The SEC also alleged in its motion that Hinman did not have “firsthand information” about the status of XRP’s securities and accused the XRP community of making “false statements” about what are known as conflicts of interest to senior officials.
Hinman expressed his personal views, not the SEC’s
In Hinman’s statement made in 2018, he mentioned that Ethereum and Bitcoin were not securities, which is the core of Ripple’s deposit requirements. However, the SEC insists that these are personal statements and do not reflect the agency’s views on the matter.
The SEC further clarified that at no time did Hinman mention, or make reference to XRP.
Hinman responded to these arguments in his statement:
“I began the speech with the following disclaimer: “My remarks are mine alone, not necessarily those of the Commission, the Commissioners, or the staff.”
However, as attorney Filan observes, this speech has been used by former chair Clayton as an example of just how transparent the SEC has been on digital assets.
3/3 Clayton used Hinman’s speech as an example of how transparent the SEC has been in its treatment of digital assets but now Hinman is tap-dancing in that declaration. See Clayton letter to Rep Budd: https://t.co/5EPcBw8i0D— James K. Filan ???? (@FilanLaw) June 25, 2021
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