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Whether Ripple Executives Live Off Their XRP Sales? Let’s See!

In a letter to Judge Sarah Netburn, the U.S. Securities and Exchange Commission senior trial attorney Jorge G. Tenreiro writes that SEC has obtained evidence that Larsen appears to continue moving his Ripple (XRP) token in spite of legal scrutiny.

THE SEC wants to find out whether Ripple executives live off their XRP sales

SEC wants to know whether the proceeds from XRP sales are a major source of income for Ripple Labs CEO Brad Garlinghouse and co-founder Chris Larsen. Tenreiro claims that the defendants’ financial condition is of critical importance to the case.

By obtaining the bank records of Larsen and Garlingohouse, it will be possible to de-anonymize their XRP transactions and determine the whole universe of their sales:

“Without the bank records, the SEC would have to take Individual Defendants at their word, particularly as the SEC has already had to “manually” trace the Individual Defendants’ transactions since they last provided data, with no guarantee that the SEC has been able to identify the complete universe of their sales and blockchain movements of XRP.”



In its landmark lawsuit against Ripple, the agency alleges that Garlinghouse and Larsen netted $159 million and $450 million, respectively, in proceeds from their XRP sales. However, since XRP transactions are pseudonymous, the defendants’ could have pocketed much more.

Earlier this week, the SEC sent subpoenas to six banking institutions to review the bank records of the two high-profile executives that span eight years. Larsen and Garlinghouse then asked the judge to quash these subpoenas, stating that the executives’ grocery purchases are not relevant to the case.

Garlinghouse and Larsen—who have been named as defendants in the SEC lawsuit against Ripple—are accused of conducting unregistered XRP sales.

In a letter to Judge Analisa Torres of the U.S. District Court for the Southern District of New York, their lawyers claim that the personal financial records of the two executives, such as their grocery purchases, are not relevant to the case, accusing the regulator of overreach.

“The SEC has not offered and cannot provide a coherent explanation for why it is entitled to this information.”

The SEC agreed to narrow the Requests to documents sufficient to show Individual Defendants’ financial condition at the time of their receipt and sales of XRP—which does not appear in Individual Defendants’ Letter.

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