Ripple vs SEC News: The SEC has Dropped Charges Against Ripple CEO Garlinghouse and Larsen

The Securities and Exchange Commission (SEC) recently stated in a court filing in the Southern District of New York that it will no longer be pursuing civil charges against Christian Larsen and Brad Garlinghouse, two executives at Ripple.

The parties have settled their complaint against the two executives, according to a document filed on Thursday. Because of this, the lawsuit is now permanently dismissed. However, as stated in the filing, the SEC will move forward with its claims against Ripple.

For nearly three years, Chris and I have been dealing with bogus claims from a regulator with what we feel to be a political agenda,” Garlinghouse said. Moreover, he said, “instead of focusing on pursuing those responsible for illicit activities involving customer funds on offshore exchanges, which were seeking political support, the SEC chose to target individuals they consider to be on the right side of the law.”

Ripple’s chief legal officer, Stuart Alderoty, referred to the SEC’s action as a “surrender” rather than a settlement, and the company issued a statement calling the SEC’s decision a “stunning capitulation.”

In a post on X (formerly Twitter) on October 19, Brad Garlinghouse said that the SEC had unfairly singled him and Chris out in an aggressive effort to ruin both them as individuals and the company they had spent a decade building.

Why Did the SEC Reject the Ripple Leaders’ Charges?

There is some mystery behind the SEC’s decision to withdraw charges against Garlinghouse and Larsen before their trial in April of 2024.

According to Cboe Digital’s chief legal officer Katherine Kirkpatrick, this could be a sign that the SEC plans to appeal the court judgment over XRP’s classification as a security. Normally, such an appeal wouldn’t be filed until after the trial was over.

When Will Ripple Finally Overtake SEC?

Although the dismissal is a major win for Ripple’s management, the SEC’s investigation into Ripple Lab continues.

Unfortunately, it appears that April will not be a good month for a trial. An appeal of Judge Torres’s ruling on the legality of programmatic sales and other distributions of XRP by the SEC is still possible.