Binance has been fined by Canada’s anti-money laundering agency due to its infringement of the nation’s anti-money laundering legislation and terrorist financing laws.
The largest crypto exchange in the world was previously probed by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) for flouting regulations last year.
Shortly after pleading guilty to violations of US anti-money laundering laws, CEO Changpeng Zhao was sentenced to four months in jail and ordered to pay $100 million (approximately Rs. 835 crore) in penalties. As a result, the firm now faces legal action.
READ MORE: LemFi Suspends Ghana Operations, Here’s Why
The FINTRAC on Thursday released a statement following the punitive action on Binance. The Post disclosed that the crypto exchange is being fined for breaching two Canadian rules that were identified for a compliance activity last year.
Binance, under the leadership of Richard Teng, has been alleged to have neglected the registration process as a foreign money services business (FMSB) in Canada, marking its initial violation.
It should be noted that Binance Holdings Limited was deemed an FMSB and was required to be registered with FINTRAC until September 25, 2023, when it officially ceased all operations in Canada. The statement said that until that day, Binance Holdings Limited violated its registration requirements.
Meanwhile, Binance is also facing action for failing to report 5,902 accounts of large virtual currency transactions between 2021 and 2023, as is expected from crypto firms in Canada under the anti-money laundering laws.
Binance failed to report the receipt from a client, of an amount in virtual currency of $10,000 (roughly Rs. 8.5 lakh) or more in the course of a single transaction, together with the prescribed information that occurred on 5,902 separate occasions during June 1, 2021 until July 19, 2023,” FINTRAC said in its statement.
Binance And Its Legal Challenges In Nigeria
Binance’s tales of woe with Canada are coming amid its embattled case with the Nigerian government over similar alleged money laundering charges amounting to $35 million.
On its part, Binance CEO, Richard Teng, accused the Nigeria government of blackmail and bribery allocation, alleging that some Nigerian officials sought a bribe of cryptocurrency from its executives, Tigran Gambaryan and Nadeem Anjarwalla, before their detention on February 28, 2024.
As our employees were leaving the venue, they were approached by unknown persons who suggested to them to make a payment in settlement of the allegations
Later that day, our local counsel — representing us at that time — was summoned by the committee through someone purporting to be their agent, who relayed the committee’s terms and instructed our local counsel to advise us
Counsel reported back that he had been presented with a demand for a significant payment in cryptocurrency to be paid in secret within 48 hours to make these issues go away and that our decision was expected by the morning,” Teng said in a blogpost statement
FG Accuses Binance Of Diversionary Tactics And Blackmail
Meanwhile, the federal government responded to the accusation by accusing Binance of using diversionary tactics and engaging in blackmail.
The Nigerian government stated that the assertion forms a component of a coordinated global effort by Binance to weaken the authority of the Nigerian government.
The spokesperson of the government added that the allegations by Binance CEO lack “any iota of substance,” and it is an attempt to “blackmail” the government.
“This claim by Binance CEO lacks any iota of substance. It is nothing but a diversionary tactic and an attempted act of blackmail by a company desperate to obfuscate the grievous criminal charges it is facing in Nigeria.
“The facts of this matter remain that Binance is being investigated in Nigeria for allowing its platform to be used for money laundering, terrorism financing, and foreign exchange manipulation through illegal trading,” the spokesperson added.
Backstory
On February 28, Nigeria officials detained two senior Binance executives.
Nadeem Anjarwalla, a 37-year-old British Kenyan who serves as the regional manager for Africa, and Tigran Gambaryan, a 39-year-old American in charge of financial crime compliance at Binance.
The executives visited Nigeria in response to the country’s recent crackdown on various cryptocurrency trading platforms.
During their stay, they were apprehended by the ONSA, and their passports were confiscated.
Following the detention of its executives, Binance decided to halt the trading of the naira against bitcoin and tether cryptocurrencies on its exchange.
