Disagreements within the U.S. Department of Justice are delaying the completion of the criminal investigation into the cryptocurrency exchange Binance, Reuters reports citing unnamed sources.
According to sources, the case opened in 2018 concerns the company’s violations of anti-money-laundering laws and U.S. sanctions. The investigation involves staff from three DOJ divisions:
- The Money Laundering and Asset Recovery Section;
- the U.S. Attorney’s Office for the Western District of Washington (Seattle);
- the cryptocurrency-crime enforcement group.
Two sources said that some participants in the investigation believe the evidence gathered is sufficient to pursue ‘aggressive action against the exchange’ and to bring criminal charges against individual executives, including CEO Changpeng Zhao. Others allegedly do not share this view and want to spend more time examining the materials.
Four sources said that in recent months Binance’s lawyers from Gibson Dunn have met with DOJ officials and argued that criminal prosecution would harm the crypto market. The discussions also included possible plea deals, three sources said.
A Binance spokesperson, in comments to ForkLog, stressed that regulators ‘conduct a thorough check of every crypto company for many of the same issues that have been widely reported’.
‘Binance demonstrated its commitment to safety and regulatory compliance through substantial investments in our team, as well as in the tools and technologies we use to detect and deter illicit activity,’ he said.
The official Binance Twitter account posted a screenshot of a letter sent to Reuters. In the statement the exchange reiterated its commitment to working with law enforcement and emphasised that the company has ‘no insight into the inner workings of the U.S. Department of Justice’.
Reuters has it wrong again.
Now they’re attacking our incredible law enforcement team. A team that we’re incredibly proud of — they’ve made crypto more secure for all of us.
Here’s the full statement we sent the reporter and a blog about our remarkable law enforcement team.
— Binance (@binance) December 12, 2022
In turn, Zhao wrote:
‘Yeah, some media are still working for …’.
smh, some media are still working for …
— CZ 🔶 Binance (@cz_binance) December 12, 2022
In November Reuters, citing data from blockchain analytics tools, said that since 2018 Binance processed Iran-related transactions totaling $8 billion, despite U.S. sanctions.
A few months earlier, journalists said that at least seven Iranian clients of the exchange continued to use their accounts up to September 2021.
In September U.S. prosecutors requested from Binance internal information about its anti-money-laundering checks, as well as messages involving Zhao, Reuters reported.
Earlier this year Reuters reported that Binance had repeatedly concealed information from regulators, neglected Know Your Customer (KYC) procedures and acted against the recommendations of the compliance department.
According to Reuters’ analysts, in 2017-2021, criminals laundered through Binance not less than $2.35 billion.
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