The U.S. Justice Department, in conjunction with their national security division, is currently investigating Binance over possible sanctions violations related to Russia’s invasion of Ukraine, according to Bloomberg. Five individuals familiar with the inquiry detailed the investigation, which is centered around the possibility that Binance enabled Russian customers to use the platform, in violation of current U.S. sanctions. Representatives from both Binance and the Justice Department did not respond to CoinDesk’s requests for comment on the matter at this time.
This inquiry comes on the heels of several other investigations into Binance’s activities, including a 2021 joint investigation with the Internal Revenue Service, and an SEC investigation into Binance’s relationship with two companies owned by founder Changpeng Zhao, since early 2022. The Commodity Futures Trading Commission (CFTC) also sued Binance in March of 2023 for knowingly trading limited crypto derivative products that are unregistered in the United States and violate federal law.
Despite denials of any wrongdoing from Binance, the allegations have cast shadows over the exchange, which claims to have constructed “the world’s largest compliance team in the space,” according to the team’s head of financial crime compliance, Tigran Gambaryan. It’s reported that the team addresses upwards of 1,300 police requests every week, indicating a push to address worldwide compliance concerns.
It’s worth noting that the exchange has recently claimed to have taken major steps to block North Korean users and has developed a massive compliance team, which would theoretically keep them from falling afoul of U.S. sanctions and other laws. However, recent articles suggest that Binance has not been entirely successful in preventing bad actors from accessing their platform. For instance, this month Israeli authorities seized 190 Binance accounts tied to known terrorist groups, including two connected to ISIS. Whether this resulted from Binance’s cooperation with Israeli authorities remains opaque at this point, as Binance never commented directly.
In conclusion, the investigation by the U.S. Justice Department adds to the growing list of legal concerns dogging Binance. This news follows reports that Israeli officials had seized almost 200 Binance accounts used by terrorist groups, some of which were affiliated with ISIS. Binance continues to deny any culpability in these allegations, stating that it complies fully with all U.S. and international financial sanctions. We’ll continue to keep an eye on developments in this case and report on any new information as it comes to light.
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The material in this article is written on the basis of another article.