Cryptocurrency exchange Binance has just been fined $6 million by the Canadian financial regulator for violating anti-money laundering and terrorist financing (AML/CFT) regulations, according to a press release from the Center for Financial Analysis. Financial Reporting and Trading Analysis Canada (FINTRAC).
The incident took place on May 7, when FINTRAC decided to impose an administrative fine on Binance Holdings Limited. The two main violations identified were Binance's failure to register as a foreign currency services business and its failure to report large cryptocurrency transactions valued at over $10,000.
Announcement from the Financial Reporting and Transaction Analysis Center of Canada (FINTRAC)
FINTRAC said that despite being facilitated to register to operate as a foreign money services business (FMSB), Binance Holdings Limited did not complete the registration procedures as prescribed by the Law on Crime Prevention and Control. (Money Laundering) and Terrorist Financing until officially ceasing operations in Canada on September 25, 2023. This conduct constitutes a direct violation of the regulations governing the operations of the FMSB in Canada.
In addition, through blockchain analysis tools, FINTRAC discovered 5,902 cases where Binance Holdings Limited did not report large cryptocurrency transactions worth 10,000 USD or more with required customer information, takes place from June 1, 2021 to July 19, 2023. This violates the Law on Crime Prevention (Money Laundering) and Terrorist Financing as well as related regulations.
Ms. Sarah Paquet, Director and CEO of FINTRAC, emphasized: “Canada's Anti-Money Laundering and Counter-Terrorist Financing Regulations were established to protect the safety of Canadians and national economic security. FINTRAC will continue to support businesses to understand and comply with their statutory obligations. We will also resolutely ensure businesses fulfill their responsibilities and will take appropriate actions when necessary.”
The $6 million fine from FINTRAC marks a new development in the series of legal troubles that Binance is facing globally. Previously, in December 2023, Binance agreed to pay a fine of $4.3 billion to US regulators for violating anti-money laundering laws, leading to former Binance CEO Changpeng Zhao being sentenced to 4 months in prison. at the end of April. In addition, Binance is also entangled in investigations into money laundering and tax evasion in Nigeria.
The legal issues raise questions about Binance's commitment to complying with financial regulations and cooperating with regulators. Increasing pressure from authorities globally requires Binance to make substantive changes and be more transparent in its operations to regain trust from the community and maintain its leading position in the money market. encode.