Binance has been fined $2.25 million by India’s Financial Intelligence Unit (FIU) as the crypto exchange firm continues to battle court trial in Nigeria.
In May, Binance had registered with the FIU as the exchange sought to commence operations in the country after the unit issued show-cause notices to nine offshore exchanges operating in violation of local rules.
FIU said the fine against Binance was for violating its money laundering law.
The Indian Authority said Binance as a registered entity in the country, has violated three sections of the country’s Prevention of Money Laundering Act (PMLA), 2002.
“Consequently, due to Binance’s ongoing provision of services to Indian clients and operations within India without adhering to its statutory obligations under the PMLA a Notice dated December 28, 2023, was issued to Binance pursuant to Section 13 of the Act, compelling Binance to demonstrate why appropriate action should not be undertaken against it for its dereliction of duties under the Act, despite its status as a Reporting Entity owing to its operations as a Virtual Digital Asset Service Provider (VDA SP),” FIU said.
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FIU explained that after considering the written and oral submissions of the Binance, Director, FIU-IND, based on the material available on record, found that the charges against Binance were substantiated.
Consequently, the Director FIU-IND order dated 19th June 2024 in the exercise of powers under Section 13 PMLA, imposed a total penalty of 18,82,00,000 Rupees on the Binance.
It added that specific directions have also been issued to Binance to ensure diligent compliance with the obligations outlined in Chapter IV of the Prevention of Money Laundering Act (PMLA) of 2002, which is in conjunction with the PMLA Maintenance of Record Rules (PMLA Rules) of 2005 for the prevention of money laundering activities and combating the financing of terrorism (AMLCFT).
This is as Nigeria’s Federal Inland Revenue Service (FIRS), filed a case of tax evasion against Binance.
The Economic and Financial Crimes Commission (EFCC) also accused it of laundering more than $35m through its platform.
Recently, the Federal Government accused Binance of influencing foreign exchange (FX) rates, leading to stricter oversight of crypto trading platforms.
In February, two of Binance senior executives In February, Nadeem Anjarwalla and Tigran Gambaryan were detained by the Federal Government.
Although the Federal High Court last week discharged Gambaryan and fleeing Anjarwalla from the FIRS tax evasion case against Binance, the FIRS has filed amendment charges against them with Binance as the sole defendant.
