Binance Under Investigation in France: Report

Binance Under Investigation in France

  • The French arm of Binance is reportedly under investigation by local authorities on charges of “aggravated money laundering” since February 2022.
  • Binance has allegedly failed to comply with Know Your Customer procedures which keep a check on users and potential money laundering activities.
  • Binance has not obtained an operating license and illegally offered its services to French customers.

Scope of the Investigation

The Paris Prosecutor’s Office reportedly cited „acts of illegal exercise of the function of a service provider on digital assets (PSAN), and acts of aggravated money laundering, by participating in investment operations, concealment, conversion, the latter being carried out by perpetrators of offenses having generated profits“ as the basis for the investigation. This indicates that the scope includes illegal activities such as money laundering and related offenses.

Requirement for Crypto Exchanges

Since 2019, crypto exchanges have been required to obtain approval from the Financial Markets Authority (AMF) in order to operate. However, Binance had only received AMF approval in May 2022 despite operating in France since 2020. This could be seen as another violation of local regulations.

Response from Binance

A Binance spokesperson told Cointelegraph that they are committed to abiding by all laws in France and cooperate with law enforcement globally. They also added that user information is held securely and only provided to government officials upon receipt of documented justification.

Recent Troubles for Binance

The reports about this investigation follows shortly after a lawsuit against Binance’s US subsidiary, Binance.US, and CEO Changpeng Zhao filed by the U.S Securities & Exchange Commission (SEC).

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