Who is George Canellos, the lawyer hired by Binance.US?

Who is Binance.US's lawyer, George Canellos?

Key figure affecting Binance.US’s fate.

Author: FYJ, BlockBeats

On June 12th, court documents showed that Binance.US hired four lawyers from Milbank, a well-known New York law firm, including George Canellos, the global head of Milbank’s litigation and arbitration group and partner of the New York office.

Earlier, John Reed Stark, former head of the SEC’s Internet Enforcement Office, speculated on Twitter that the US Department of Justice may bring a criminal indictment against Binance, saying that the CFTC and SEC complaints read like criminal indictments, riddled with fraud, deceit, obstruction of justice, and money laundering charges, and that neither the CFTC nor the SEC cases focused on money laundering, “which could be an indictment space reserved for the US Department of Justice’s criminal lawsuit against Binance.”

Later that day, George Canellos’s name drew attention from all sides, and John Reed Stark immediately believed that Binance’s hiring of George Canellos was evidence of his previous prediction that Binance was preparing for a possible criminal lawsuit. Bloomberg also pointed out that he has a background in both criminal and bankruptcy cases. Regardless of how each party interprets it, George Canellos has become an important figure in Binance’s case.

What kind of person is George Canellos, who has been entrusted by Binance?

George Canellos’ career began in the litigation department of Wachtell, Lipton, Rosen & Katz, a law firm known for corporate law, where he mainly handled merger disputes and securities litigation during his tenure. In 1994, he joined the US Attorney’s Office in the Southern District of New York and held multiple positions during this period, leading the prosecution of many high-profile cases. As head of the Major Crimes Division, he supervised Assistant US Attorneys in investigating and prosecuting large-scale financial crimes, and as a senior trial attorney in the Securities and Commodities Fraud Task Force, he led numerous prosecutions of individuals and companies for accounting fraud, investment advisory fraud, insider trading, and other violations of federal securities laws.

During his four and a half years at the SEC, Canellos served as acting director and deputy director of enforcement before ultimately becoming co-director of the SEC’s enforcement division, during which he oversaw the civil law enforcement work of approximately 1,300 SEC personnel in 12 offices across the country, including investigations, prosecutions, and trials.

During his time at the SEC, Canellos oversaw many landmark enforcement cases, most notably two of the key insider trading cases in US financial history.

The first case was the insider trading case against hedge fund founder Raj Rajaratnam, which was once known as the “largest insider trading case in Wall Street history”. From 2003 to 2009, Rajaratnam manipulated a complex network of high-level insiders and used leaked company secrets for insider trading, illegally profiting a total of $63.8 million. Rajaratnam was eventually found guilty of 14 counts of fraud, sentenced to 11 years in prison, and forfeited all illegal gains; in this case, far more than Rajaratnam were targeted by the SEC and the US Department of Justice, and a total of 21 people were arrested and pleaded guilty in the case.

The other well-known case occurred in 2013, when Canellos participated in the investigation of insider trading at hedge fund SAC Capital. SAC Capital founder Steven Cohen ultimately paid the SEC a whopping $600 million fine, avoiding potentially two to three years of civil litigation, and paid the US Department of Justice a $1.2 billion fine to avoid prosecution for five counts of securities fraud. Mathew Martoma, the portfolio manager who directly operated the insider trading fund, was sentenced to nine years in prison on September 8, 2014. In addition, SAC Capital was also ordered by the court to return all external client funds under its management, and Cohen’s subsequent rise to power relied on his family office Point72, essentially withdrawing from the hedge fund industry after the case. Prior to this, Steven Cohen was known as the “new king of hedge funds on Wall Street”.

In these and other cases, Canellos worked closely with senior leaders of the US Department of Justice, FINRA, CFTC, state attorneys general, and the UK Financial Conduct Authority, as well as financial market regulatory agencies in Europe and Asia. In addition, Canellos served as co-chair of the RMBS Working Group, a cross-agency financial fraud task force established by the Obama administration in 2009.

“Canellos has a rare and very special background combination – having served as an SEC prosecutor and a Justice Department prosecutor, just like Liam Neeson plus Perry Mason (the genius lawyer in the famous detective novel series by American writer Erle Stanley Gardner),” former US SEC Internet Enforcement Office Director John Reed Stark commented in a tweet.