According to recent media reports, the United States Department of Justice (DoJ) has brought Binance under its radar for violating sanctions on Russia. Sources familiar with the matter suggest that The DoJ’s national security division is conducting an inquiry into whether Binance allowed Russian customers to access the exchange in violation of U.S. sanctions.
The United States and its allies have imposed sweeping sanctions, export controls, and other measures following the start of Russia’s war against Ukraine. Since February 2022, the Treasury has implemented more than 2,500 sanctions in response to Russia’s war of choice.
Notably, the Justice Department’s recent inquiry is another high-profile action against Binance. Prior to this, in 2021, the DoJ executed a joint investigation with the Internal Revenue Service (IRS) against the global exchange.
Reportedly, Binance is buried under charges against it at the moment. The Securities and Exchange Commission (SEC) has been investigating Binance for its relationship with two firms owned by its founder Changpeng Zhao since early 2022.
On the other hand, the Commodity Futures Trading Commission (CFTC) is suing the exchange and its CEO for intentionally offering unregistered crypto derivatives products in the U.S. against federal law.
While Binance or the DoJ did not explicitly comment on the case, a Binance statement to Bloomberg states that the company fully complies with all the US and international financial sanctions.
The exchange has repeatedly pushed back against allegations by saying it has built the world’s largest compliance team in space. According to Tigran Gambaryan, head of compliance, there is a 700-member team that “addresses 1,300 law enforcement requests on a weekly basis.”
Meanwhile, Todayq News reported that Israeli authorities have seized roughly 190 Binance accounts with alleged ties to terrorist groups like Hamas and ISIS. However, neither Israel nor Binance explicitly said Binance had cooperated, it isn’t clear how Israel seized accounts on Binance without the exchange’s cooperation, given Binance isn’t obliged to adhere to Israeli laws.
Cryptocurrencies have made a major place as Russia’s war against Ukraine intensifies. While Ukraine has relied on crypto donations, Russian authorities looked up to it as a means to settle cross-border transactions.
Nonetheless, owing to fears that Bitcoin and other crypto assets are being used to get over sanctions, countries across the globe tightened their vigilance over the sector.
In October, the Monetary Authority of Singapore (MAS), the nation’s central bank and financial regulator, reminded all approved crypto exchanges in the region to abide by the financial restrictions put in place against Russia. Similarly, UK authorities issued regulations mandating crypto exchanges to notify suspected sanctions breaches to UK authorities.