Witness Labels Binance’s Operations in Nigeria as Illegal

A Nigerian court has heard the prosecution’s arguments in the case against Binance and the exchange’s Vice President for Global Intelligence and Investigations, Tigran Gambaryan. This was reported by Premium Times.

The second witness in the proceedings was Olubukola Akinwumi, Deputy Head of the country’s Central Bank. He stated that the department he leads, responsible for payment policy and regulation within the Payment System Management Department (CBN), did not grant the platform a license to operate in Nigeria.

The official clarified that the CBN monitors the situation in the context of the SEC and separately the activities of organizations within the CBN framework. The Deputy Chairman of the CBN indicated that the agency was aware of the nature of Binance’s business.

Akinwumi explained that the platform operates on the company’s website, binance.com, and through its mobile applications, namely Binance Pro and Binance Lite.

“To conduct transactions, [exchange] clients use the payment system to transfer or make payments to each other. These traders usually trade under pseudonyms […], and they are not authorized by the CBN,” Akinwumi stated.

He added that transactions occur on the Binance Peer-to-Peer (P2P) platform provided by the organization.

“The company handles P2P transactions, either using a bank account in a Nigerian bank already held by users on the exchange, or a naira wallet account provided by it,” the official explained.

According to Akinwumi, the materials provided by the prosecution demonstrate that the exchange’s offering of naira deposits and withdrawals via cash link [the essence of the EFCC accusations] is a regulated activity. It is carried out by banks and other institutions that require CBN registration.

The official noted that other materials show various Binance initiatives regarding educating clients on using this fiat gateway. Evidence was also presented indicating the platform charges fees for withdrawals.

The next hearing in the case is scheduled for July 16.

Earlier, in addition to tax evasion and money laundering, Nigerian authorities accused Binance of conducting specialized financial activities without a license. The company potentially faces a $10 billion fine.

In June, Nigeria’s Federal Inland Revenue Service dropped tax evasion charges against Gambaryan. He remains in prison, and in the same month, he was visited by U.S. House Representatives French Hill and Chrissy Houlahan.

Previously, the exchange was required to provide data on all Nigerian users and their transaction history. The platform was also obliged to settle any outstanding tax liabilities.