Probe Alleges Fraud, Money Laundering

On Jan 28, 2025

Binance is facing yet another regulatory storm in
France. The country’s authorities have now launched a criminal investigation
against crypto exchange, alleging tax fraud, money laundering, and illegal
operations tied to drug trafficking.

According to a report by Reuters, the investigation,
led by France’s financial crime unit (JUNALCO), accuses Binance of facilitating
money laundering linked to drug trafficking. The case spans between 2019 and
2024.

Prosecutors claim the platform failed to report
suspicious activities and operated without necessary approvals in France and
other European Union countries. Complaints from users who said they lost money due to
misleading communication and unlicensed trading practices fueled the probe.
Binance, in a statement, denied all allegations, calling them outdated and
vowing to fight the charges.

This is not the first time Binance has clashed with Paris watchdogs. In 2023, public prosecutors investigated Binance France over the ‘illegal’ provision of crypto services before it
was licensed.

While defending the crypto exchange Former CEO
Changpeng Zhao, Binance dismissed the report, saying the exchange received a
surprise visit from the local authorities prior to the investigation. Zhao
added that the inspections was usual for banks and also crypto companies.

4. FUD.
In France, surprise (no advanced notice) on-site inspections of regulated businesses are the norm, for banks, and now for crypto too.
The surprise visit for Binance France happened a couple of weeks ago. It’s not “news”. Binance France cooperated fully.
Binance also… https://t.co/xdbLc5jXBW
— CZ 🔶 BNB (@cz_binance) June 16, 2023

Elsewhere, Zhao pleaded guilty to violating US anti-money laundering laws in 2023, the same year. Consequently, Binance paid a
$4.3 billion penalty as part of the settlement.

US prosecutors accused the company of ignoring over 100,000 suspicious transactions linked to criminal activities,
including terrorism financing. The company’s troubles extend beyond the US and
France. Australia’s corporate watchdog recently sued Binance for allegedly
denying retail customers proper protections.

Binance’s Response

Binance has repeatedly claimed it is improving its
compliance. The company praised its services, pointing to advancements in
anti-money laundering protocols and enhanced employee training. Binance
says it has adopted global standards for Know-Your-Customer processes to
combat illicit activity.

Despite these assurances, French prosecutors argue
that the company’s actions have harmed investors. The Financial Action Task
Force has also warned that cryptocurrency remains a haven for financial
crimes, highlighting the risks in the industry.

Binance’s mounting legal woes reflect broader
challenges in the cryptocurrency world. Interestingly, a wave of bankruptcies
in 2022 revealed widespread fraud across major crypto platforms, leaving
millions of investors in financial ruin.

4. FUD.
In France, surprise (no advanced notice) on-site inspections of regulated businesses are the norm, for banks, and now for crypto too.
The surprise visit for Binance France happened a couple of weeks ago. It’s not “news”. Binance France cooperated fully.
Binance also… https://t.co/xdbLc5jXBW
— CZ 🔶 BNB (@cz_binance) June 16, 2023

Elsewhere, Zhao pleaded guilty to violating US anti-money laundering laws in 2023, the same year. Consequently, Binance paid a
$4.3 billion penalty as part of the settlement.

Binance’s Response

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