Despite a historic agreement with the American authorities in 2023 and strict commitments in the fight against money laundering, Binance has reportedly failed to block suspicious accounts. The latter are said to have transferred colossal sums, raising serious questions about the real effectiveness of the controls put in place.
In brief
- Internal data reveals that 13 suspicious accounts continued to operate on Binance after the November 2023 agreement with the United States.
- These accounts have transferred $144 million since November 2023 and $1.7 billion since 2021.
- Some of these accounts received $29 million from wallets later frozen by Israel for terrorist financing.
- However, the 2023 agreement imposed strict five-year monitoring by FinCEN and strengthened compliance measures.
Gaping flaws in the surveillance system
In November 2023, Binance agreed to pay a record fine of $4.368 billion for violating bank secrecy laws and US sanctions.
This agreement caused the resignation of Changpeng Zhao, its emblematic CEO, and imposed draconian five-year surveillance on the platform by the Financial Crimes Enforcement Network (FinCEN). The objective was clear: transform Binance into an impeccable player in regulatory compliance.
However, internal documents leaked to the Financial Times tell a different story. Thirteen suspicious accounts would have continued their activities without incident after November 2023.
Among them, that of a 25-year-old Venezuelan woman who received more than $177 million in crypto between April 2022 and 2024. This account modified its bank details no less than 647 times in fifteen months, using 496 different accounts spread across the Americas. Behavior that should have set off all the alarms.
Another case calls out: a 30-year-old Venezuelan bank employee, whose account transferred 93 million dollars. Connection logs reveal connections in Caracas at 3:56 p.m., then in Japan seven hours later. A physical impossibility which suggests either account sharing or the use of virtual private networks to hide the real origin of transactions.
Binance, between defense and reinforced surveillance
The analysis of financial flows reveals even more worrying connections. Between February 2022 and March 2023, these 13 accounts collectively received $29 million in USDT from wallets subsequently frozen by Israel for links to terrorist financing.
The bulk of these funds came from four wallets associated with Syria's Tawfiq Al-Law, accused of transferring illicit sums for Hezbollah, the Houthis in Yemen and entities linked to the Assad regime.
These wallets were seized by Israel in May 2023, several months before the Binance-US deal. OFAC (Office of Foreign Assets Control) subsequently sanctioned Al-Law in March 2024.
Binance emphasizes that it “evaluates transactions based on information available at the time they take place” and that none of the wallets were officially on the sanctions lists during the mentioned transfers.
The platform claims to have “robust systems to identify and review suspicious transactions”. It insists that it has operated under the supervision of an independent monitoring body since November 2023 and complies with all applicable financial sanctions. Binance categorically rejects the Financial Times presentation, believing the report distorts the reality of its compliance efforts.
In short, non-compliance with the agreement could cost Binance dearly: an additional fine of $150 million looms over the platform. For an exchange that dominates the global market with more than half of trading volumes, these revelations tarnish an already damaged reputation.
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