KUALA LUMPUR – The world’s biggest cryptocurrency exchange, Binance Holdings Ltd has to fork out a whopping US$4.3 billion (RM20.5 billion) for a settlement approved by a US judge after violating anti-money laundering and sanctions laws.
The government said in its memorandum that the violations committed by Binance resulted in criminals using the exchange to move hundreds of millions of dollars of stolen funds and illicit proceeds.
This is the largest penalty imposed against a financial services business and “commensurate with the severity of Binance’s criminal conduct”.
The probe found that Binance failed to report more than 100,000 suspicious transactions involving designated terrorist groups, including Al-Qaeda and Isis. It also found that the platform supported the sale of child sexual abuse materials.
In a statement following the ruling, Binance said it accepted responsibility, upgraded its anti-money laundering and “know-your-customer” protocols, and made progress in the changes listed in the plea agreement.
As part of the settlement reached in November, Binance chief executive Changpeng Zhao pleaded guilty to violating US anti-money laundering laws and stepped down from his position.
Binance was created in 2017 and dominated the crypto-trading market, making Zhao a billionaire. Although operations started in China, Zhao moved operations to other locations outside the country following Beijing’s crackdown on crypto trading.
The company in 2022 was valued at US$3 trillion, coupled with complex products and celebrity endorsements.
However, after the criminal charges came to light, investors pulled out their money and public confidence dipped. – February 24, 2024