The United States Department of Justice must put a share of its massive $4.3 billion settlement with Binance toward a fund for victims of state-sponsored terrorism, a lawsuit claims.
On Sept. 25, four people who are the victims or family of victims of state-sponsored terrorism sued the DOJ in a Washington, DC federal court claiming it improperly withheld or delayed depositing the proceeds of Binanceâs November settlement into the Victims of State Sponsored Terrorism Fund.
The suit claimed under the Victims of State Sponsored Terrorism Act, 100% of criminal proceeds and 75% of civil proceeds from cases like Binanceâs should be deposited into the fund â established to compensate victims of state-sponsored terrorism.
But so far, they alleged the DOJ has put just over $898.6 million into the fund and âhas asserted that it intends to direct at least $1.5 billionâ into a fund for crime victims, which the lawsuit claimed is illegal.
Snippet from filing in Case 1:24-cv-02714. Source: Courtlistener
The suit seeks a court order requiring the DOJ to deposit all qualifying Binance proceeds into the Victims Fund.
The lawsuit also named the Commodity Futures Trading Commission, US Attorney General Merrick Garland, and the Treasury Department along with its agencies the Financial Crimes Enforcement Network (FinCEN), and the Office of Foreign Assets Control (OFAC) as defendants.
Crypto exchange Binance pled guilty in November 2023 to violating US sanctions and the International Emergency Economic Powers Act (IEEPA) in 2023, agreeing to pay over $4.3 billion in fines and forfeitures.
Former CEO Changpeng Zhao also agreed to plead guilty to one felony charge related to violations of the Bank Secrecy Act, pay a $50 million penalty and step down as CEO. In April, he was sentenced to four months in jail and is set to be released on Sept. 29.Â
In May 2023, the DOJâs national security and crime divisions investigated Binance for providing services to Russians after sanctions were imposed on the country in April 2022.
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