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India Fines Binance $2.25 Million for Unregistered Operations Amid Ongoing Legal Troubles

India’s Financial Intelligence Unit (FIU) has fined Binance, the world’s largest cryptocurrency exchange, $2.25 million (188.2 million rupees) for operating without proper registration in the country. The penalty, announced in a statement on Thursday, was imposed after Binance was found to have violated three sections of India’s Prevention of Money Laundering Act (PMLA), 2002.

The FIU’s statement highlighted that Binance, as a Virtual Digital Asset Service Provider (VDA SP), is considered a reporting entity under the PMLA. Despite registering with the FIU in May, Binance failed to comply with necessary regulations. This non-compliance led to a show-cause notice issued to the exchange on December 28, 2023. After reviewing Binance’s responses, the FIU Director concluded that the charges were substantiated, resulting in the hefty fine imposed on June 19, 2024.

The document from the FIU stated: “Binance, by virtue of operating as a Virtual Digital Asset Service Provider…is a reporting entity in terms of Section 2(1) (wa) of the Act.” It continued, “Due to Binance’s ongoing provision of services to Indian clients and operations within India without adhering to its statutory obligations under the PMLA…appropriate action has been undertaken against it.”

This development is the latest in a series of legal challenges faced by Binance. In Nigeria, the exchange is under scrutiny for alleged money laundering and tax evasion. The Economic and Financial Crimes Commission accused Binance of laundering over $35 million through its platform, while the Federal Inland Revenue Service has filed a separate tax evasion case.

In February, Nigerian authorities detained two senior Binance executives, Nadeem Anjarwalla and Tigran Gambaryan, despite the country’s ban on cryptocurrency channels. This move is part of Nigeria’s broader effort to curb currency speculation and enforce stricter oversight on crypto trading platforms. Although a Federal High Court dismissed tax evasion charges against these executives, amended charges have been filed, naming Binance as the sole defendant.

Binance’s ongoing legal battles and regulatory challenges across multiple jurisdictions underscore the increasing scrutiny that cryptocurrency exchanges face worldwide.

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