- India’s FIU has fined Binance $2.25 million
- FIU says Binance served Indian customers without following the country's Anti-Money Laundering (AML) regulations
- Strict regulations have forced Binance out of big crypto markets
According to the FIU, the exchange served Indian customers without following the country's Anti-Money Laundering (AML) regulations.
The FIU made this known via a statement it released on June 19, declaring that numerous infractions of the 2002 Prevention of Money Laundering Act (PMLA) are subject to the fine.
The FIU order. Credit: FIU
“Due to Binance's ongoing provision of services to Indian clients and operations within India without adhering to its statutory obligations under the PMLA a Notice dated December 28, 2023, was issued to Binance pursuant to Section 13 of the Act, compelling Binance to demonstrate why appropriate action should not be undertaken against it for its dereliction of duties under the Act, despite its status as a Reporting Entity owing to its operations as a Virtual Digital Asset Service Provider (VDA SP),” the FIU statement read.
The statement further read that “after considering the written and oral submissions of Binance, Director, FIU-IND, based on the material available on record, found that the charges against Binance were substantiated. Consequently, the Director FIU-IND vide order dated 19 June 2024 in exercise of powers under Section 13 PMLA, imposed a total penalty of Rs. 18,82,00,000 (Rupees Eighteen Crore Eighty Two Lakh Only) on the Binance with reference to following violations committed by the Binance.”
Many troubles of Binance
Binance, the world’s largest crypto exchange, has had many challenges recently as governments tighten the regulatory noose on cryptocurrency trading.
ALSO READ
US SEC closes investigation into Ethereum
Uphold delists USDT, DAI and 4 other popular stablecoins
5 simple ways to make money from Crypto in 2024
Recently, the company’s former CEO, Changpeng Zhao, was charged by US regulators, the SEC, alongside the company for breaking anti-money laundering laws and violating sanctions in the United States. Zhao pleaded guilty to the charges and a plea deal was agreed. The company would pay $4.3 billion in fines and reparations. Zhao would step down as CEO and eventually get a light sentence.
In Nigeria, the company has been facing allegations of tax evasion, and one of its executives is being held at a prison in Nigeria’s capital, Abuja. Earlier this year, it stopped all Nigerian Naira transactions and delisted all Naira pairs on its platform in March.
Binance had had to exit several markets due to strict regulations. For instance, the exchange in June last year exited the Dutch market. Shortly after exiting the Dutch market, it also exited the UK’s. The exchange agreed to exit the US and pay fines amounting to $8.7 billion in November last year. It had earlier exited the Russian market too.
Due to Binance’s sheer size, anything that affects the exchange will somehow impact the growth and acceptability of crypto and the industry in general. Experts think that Binance needs to fix its challenges fast for its own good and that of the crypto industry.
“The question really is whether or not crypto is actually growing up in a way that is allowing it to have an existence beyond its influential founders who have been shepherding the brand, shepherding the innovation, shepherding the advocacy for these institutions. That’s something that will have to be seen over the next couple of months,” Yesha Yadav, a law professor at Vanderbilt University and an expert on financial regulation, said via CNN.
