New Zealand High Court Case
Overview of the New Zealand Claim
We are now seeking New Zealand claimants to join a "representative action" (also known as a class action) to be filed pursuant to Section 4.24 of the New Zealand High Court Rules. A representative action is a legal procedure that allows one or more plaintiffs to file a lawsuit on behalf of a larger group of claimants who have similar claims against the same defendant such as Binance. This group of claimants is known as the "class," and the legal action is taken collectively. Representative actions are useful when individual claims are too small to justify separate lawsuits but collectively represent a significant legal issue. Individual claimants have the legal right to "opt-in" or "opt-out" of being part of the representative action.
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Basis for the New Zealand Claim
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We are strong proponents for crypto currencies and the crypto currency industry. However, Binance's futures, options, leveraged tokens and other restricted products (collectively, the "Restricted Products") were not crypto currencies. Instead, such products were extremely complex financial derivatives which were not properly described or licensed as required by the express requirements set forth in the New Zealand Financial Markets Conduct Act 2013 (FMC). By advertising and selling its Restricted Products, Binance directly violated the FMC. As a result of such violations, New Zealand purchases of Binance's Restricted Products are entitled to rescind their investments and receive compensation equal to the amount of any losses which arose in connection with such purchases.
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Binance was prohibited from offering its products and services in New Zealand however it blatently ignored its obligations by advertising to New Zealand investors through several channels including by email, through its New Zealand Facebook Page and through its New Zealand Telegram channel. Although Binance later sought a "Financial Service Provider" (FSP) license in New Zealand in September 2022, such license did not allow it to advertise and sell its Restricted Products. Furthermore, in connection with its application for the FSP licence, Binance attempted to conceal its prior illegal behavior by (i) deleting the content on its New Zealand Facebook page, (ii) deleting the content in its New Zealand Telegram channel, and (iii) failing to disclose its prior email communications to New Zealand investors (see example emails targeted to New Zealand investors prior to the time of Binance's FSP license).​​​
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Based on significant analysis to date, it is our belief that some of the Restricted Products also were misrepresented and were operated by Binance in a fraudulent manner. Once evidence is provided to governmental authorities we believe that Binance and its founder will be subject to additional criminal charges (i.e. beyond the outstanding U.S. SEC charges and prior U.S. CFTC convictions).
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A formal complaint has previously been filed with New Zealand's Financial Market Authority (FMA). However, unlike the securities regulators in many other countries, the FMA has previously indicated that it wants to have further evidence of the number of New Zealand investors harmed by Binance's actions before considering further action. So if you or someone you know purchased Restricted Products then please contact us even if you don't want to participate in the class action -- we will compile the information of all affected investors in order to pass it along to the FMA.
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How to Participate
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As an initial step, please complete the Compensation Questionnaire which takes less than two minutes to complete. We will review your answers and be in touch with more information. It is not important if your losses were small since the purpose of a class action claim is to aggregate many smaller losses into a larger class action claim.
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Is There Any Cost
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There is no upfront cost to participate. However, in order to fund the legal fees associated with the claim we are negotiating with several litigation funding companies. Subject to approval by the High Court, such funding sources typically receive between 20% - 30% of the amount ultimately awarded to the claimants in exchange for the cost and risk associated with providing such funding.
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