A United States Securities and Exchange Commission (SEC) brief detailing proposed fines and penalties for blockchain firm Ripple describes a different narrative than the one pushed by the company’s executives.
In a March 25 filing in U.S. District Court for the Southern District of New York, attorneys for the SEC proposed Ripple pay $876,308,712 in disgorgement and $198,150,940 in prejudgment interest and a $876,308,712 civil penalty — roughly $1.95 billion total. According to the regulator, the fines and penalties were appropriate based on Ripple’s “defiance of the law,” continuing to sell XRP after legal warnings.
“Ripple is well-positioned to pay a significant civil penalty,” said the SEC. “And one is warranted here both because a civil penalty should not be just the cost of doing business for a securities law violator, as the Second Circuit has held, and because the need for deterrence is clear given Ripple’s enormous amount of unregistered sales of XRP over the last three years.”
The filing was consistent with what Ripple Chief Legal Officer Stuart Alderoty claimed would be made public in a March 25 X post: roughly $2 billion in fines and penalties. Alderoty claimed the SEC intended to “punish and intimidate” Ripple, adding the firm planned to file a response to the proposed judgment in April.
The proposed SECorder added:
“Only a significant sanction from this Court and the return of the ill-gotten gains Ripple made from its violations will cause Ripple to correct its conduct.”
Related: RippleX addresses XRP ledger’s AMM pool error, advises user caution
Filed in December 2020, the SEC’s lawsuit against Ripple, CEO Brad Garlinghouse, and co-founder Chris Larsen alleged the firm raised $1.3 billion in unregistered securities through sales of XRP tokens. The case made waves in the crypto space when Judge Analisa Torres ruled in July 2023 that XRP was not a security regarding programmatic sales on digital asset exchanges.
Magazine: ETH a security? Celsius clawbacks, SBF says sentence too harsh: Hodler’s Digest, March 17-23