Binance under investigation by Justice Dept and IRS for Money laundering


Cryptocurrency exchange Binance is reportedly facing an investigation by the U.S. Internal Revenue Service as well as the Department of Justice, according to a report by Bloomberg.

According to the report, officials from the DOJ and the IRS have “sought information from individuals with insight into Binance’s business,” citing unnamed sources. Bloomberg’s report noted that “[t]he federal agencies haven’t accused Binance of wrongdoing.”

Bloomberg reported in mid-March that Binance was facing an inquiry from the Commodity Futures Trading Commission (CFTC) over whether the exchange allowed U.S. residents to trade on its platform. 

Minutes after Bloomberg’s report became public via headline newswires, Binance CEO Changpeng Zhao tweeted: “So much FUD today. It’s a pain for some, an opportunity for others.” That message was similar to one he issued in the wake of Bloomberg’s CFTC report in March. 

“We take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion.,” a Binance spokesperson told The Block when reached. “We have worked hard to build a robust compliance program that incorporates anti-money laundering principles and tools used by financial institutions to detect and address suspicious activity. We have a strong track record of assisting law enforcement agencies around the world, including in the United States.  We don’t comment on specific matters or inquiries.”

In recent months, Binance has sought to beef up its regulatory advisory team. In March, Binance hired former U.S. senator Max Baucus as a regulatory advisor, and later that month the exchange added two former members of the Financial Action Task Force (FAFT) to its advisory team. 

As previously reported, Binance has faced regulatory scrutiny in Europe for its stock token trading service. The offering drew a public warning from regulators in Germany. 

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  1. CZ also tweeted

    ‘The “news” title is bad. Article itself isn’t so bad actually (but who reads). It described how
    @ binance collaborated with law enforcement agencies to fight bad players, but somehow made it look like a bad thing… Thinking face Anyways. Back to work.’

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