Crypto giant Binance reportedly faces US probe for breaching Russian sanctions

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Binance would face a new investigation by the US Department of Justice, and this time it would be about possible violations of the sanctions imposed on Russia. According to Bloomberg, the agency is investigating whether the cryptocurrency exchange allowed Russian customers to transfer money in order to circumvent US sanctions against financial institutions in the country. The news agency sources also said that Binance was discussing the possibility of settling with the DOJ regarding previous allegations that the exchange was also used to move money to circumvent US sanctions on Iran.

If you recall, the United States and the European Union imposed sanctions on Russian financial institutions following the invasion of Ukraine. Ukrainian Deputy Prime Minister Mykhailo Federov asked major crypto exchanges to freeze all Russian and Belarusian accounts at once, but Binance was one of the companies that refused to do so. At the time, a spokesperson said unilaterally banning people’s access to cryptocurrency “would defeat the very purpose crypto exists” because it would affect ordinary users and not just the Russian oligarchs.

If the DOJ is really looking into Binance’s activities related to Russian sanctions, this is just one of the investigations the exchange is facing. The DOJ and Internal Revenue Service began investigating reports that Binance is being used for money laundering schemes in 2021. And just earlier this year, the Commodity Futures Trading Commission (CFTC) accused Binance and its founder Changpeng Zhao (pictured above) for not asking users to verify their identity, offering unregistered crypto derivatives and implementing measures to avoid US regulation. Binance told us at the time that it found the accusations “unexpected and disappointing.”

This time, he told Bloomberg in a statement, “In 2021, Binance launched an initiative to completely overhaul its corporate governance structure, including bringing in a seasoned group of world-class executives to fundamentally change the how Binance works globally.” The spokesperson went on to say that the company now adheres to strict know-your-customer protocols similar to those employed by traditional banks. “Our policy,” they said, “imposes a zero-tolerance approach to duplicate registrations, anonymous identities and obscure sources of money.” While they didn’t specifically address the allegations, the statement sounds like a denial that the company’s service allowed Russian users to flout US sanctions.

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