Treasury Accuses Binance of Enabling Illicit Transactions

• Binance Resolves Dispute with US Department of Treasury over Terrorist-Related Transactions
• Impact of the Settlement Amid Ongoing Conflict
• Implications of the Settlement
• Binance Penalized with Record-Breaking Fine
• US Attorney General's Remarks
• Future Obligations for Binance

Binance Resolves Dispute with US Department of Treasury over Terrorist-Related Transactions

Crypto exchange Binance has reached an agreement with the US Department of Treasury following accusations of facilitating transactions for terrorist groups such as Hamas, Al Qaeda, and the Islamic State of Iraq and Syria (ISIS). Changpeng CZ Zhao, the CEO and founder of Binance, admitted to criminal charges stating that Binance failed to mitigate illicit activities on its platform, as disclosed by the Treasury Department.

Impact of the Settlement Amid Ongoing Conflict

The resolution comes amidst the escalating Israeli-Palestinian conflict, ignited by Hamas terror activities in October, which claimed over 1,200 lives and resulted in numerous hostages. Current Binance CEO, Changpeng Zhao, and the crypto exchange came under fire from US Attorney General Merrick Garland for not meeting their legal obligations to track and report suspicous transactions.

Implications of the Settlement

This settlement will drive forward our criminal investigations into malevolent cyber activity and terrorism fundraising, including the exploitation of cryptocurrency exchanges to aid groups like Hamas, Garland assured. Following the resolution, Binance is obliged to pay significant fines, some of which will be divided among various agencies.

Binance Penalized with Record-Breaking Fine

The Financial Crimes Enforcement Network (FinCEN) is set to receive $3.4 billion, the largest fine in its history. Furthermore, the Office of Foreign Assets Control (OFAC) is slated to receive $968 million. These penalties are intended to hold Binance accountable for its apparent negligence in preventing illicit transactions, underscoring the seriousness of the allegations.

US Attorney General's Remarks

In a press conference, US Attorney General Merrick Garland emphasized that Zhao's admission of guilt and Binance's settlement would bolster criminal investigations into cyber activities and terrorism fundraising, specifically involving the misuse of cryptocurrency exchanges.

Future Obligations for Binance

As part of the settlement terms, Binance is now required to report any suspicious transactions relating to terrorism going forward and to conduct a comprehensive review of past activities that should have been reported.

Edited by Jonathan Stoker