Money Laundering Preventions Done By Binance

by | Jul 25, 2022 | Funding101, Market, Market News, News | 0 comments

One of the largest crypto exchanges, Binance, was continuing its journey from 2017 all over the world. It is now a well-known popular crypto platform for global crypto traders and investors. But its money laundering rumpus has been making headlines over the past few years. Till now, its anti-money laundering operation is not fixed well. The assurance given by this exchange company ultimately failed to be fulfilled.

Binance’s Assurance Vs The Productiveness :

The CEO of Binance, Changpeng Zhao was indicated as responsible for several clatters. It was reported that Mr. Zhao initially ignored his compliance team employees’ concerns about the issue. At that time, a spokesperson of Binance stated that they were planning and investing in some valuable and effective technologies to get a transparent crypto world. It was even said that Binance got approval from France and Italy as the first crypto exchange company among G-7 countries to upgrade their security.

Later, a well-known mainstream media reported that Binance was not done with its anti-money laundering program. Instead, it becomes a ‘hub’ of fraudsters, hackers, and drug traffickers. Though, the official of Binance, Matthew Price rejected this claim saying that Binance became an agenda for the media. According to him, the exchange platform was focused on several security projects for the users.

In 2021, KYC (Know Your Customer) became mandatory for every user. Without updating the KYC, users were only able to transfer 0.06 BTC from 2 BTC.

At that time another spokesperson claimed that Binance was leading and investing in future technologies to grow a well-regulated crypto world. Whereas practically no changes have been seen in this platform regarding their claim.

Several Blunders Exposed :

In the same year, Binance was exposed to serving its services in Iran until September 2021. But according to the regulation, from 2018, Iran was banned to serve Binance offers after the US reimposed sanctions. This raised the question, of why and how Binance was serving Iran after banning it?

Even 7 traders from Iran of Binance were investigated. They claimed that they were able to trade through Binance until the KYC came into force last year.

But the tightened KYC process did not work well among the transactions. It was claimed as a weak KYC and anti-money laundering initiative. Ultimately the overall business and financial structure of Binance became obscured. Lack of transparency and weak management failed to perform well in money laundering prevention.

Last year, Mr. Zhao merged with Germany’s Munich-based regulated financial service firm, CM-Equality. At that time, the service company started a close investigation on the users who transacted more than $11k in a one-time transaction. Binance upped it into a $1 lakh transaction.

During this time, it was reported that Binance was getting several letters from the German authority and law enforcement sector. In this context, Binance explained it as a regular letter from the authority regarding answering the law enforcement process.

After all these loopholes, Binance stands against its risk trading condition by recruiting customers from Russia and Eastern Europe. Additionally, Binance’s CEO avoided three senior employees’ concerns regarding the exchange platform.

Apart from these all blunders, 5 interviewees exposed Binance’s weak technology and tools. They claimed that the exchange platform is unable to follow the exact footprints of each currency in the blockchain. According to them, the existing techniques and tools are backward and weaker.

Recent Updates :

Lastly, according to recent updates, Pakistan is investigating a fraud over $100 million which took place on this exchange platform. Other than that, a Turkish organization fined Binance $750,000 for violating the regulation. Similarly, in April 2022, the Dutch Central Bank fined EUR 3.3 million to this exchange company for offering services to the Netherlands without being registered in the country. Asia has withdrawn its application from Binance regarding a crypto exchange operation in Singapore.

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