Binance, one of the leading cryptocurrency exchanges, is facing a significant setback as it has been ordered to pay a hefty settlement to Canadian authorities due to allegations of money laundering. The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) imposed a fine of $6 million Canadian dollars ($4.3 million) on Binance on May 9. The charges against Binance include money laundering and terrorism funding.
The Canadian anti-money laundering agency accused Binance of neglecting its regulatory obligations in the country. Before offering its services to Canadians, Binance failed to register as a foreign money service firm with the appropriate authorities. Despite multiple reminders, Binance did not take registration seriously and continued to receive cryptocurrency from Canadian customers even after leaving the country last year.
Additionally, Binance allegedly did not comply with Know-Your-Customer (KYC) protocols for the associated accounts, with approximately 5,902 transactions totaling around $10,000 CAD conducted on the platform between June 1, 2021, and July 19, 2023.
This latest fine compounds the challenges faced by Binance, as it comes after the $4.3 billion penalty imposed by the US Department of Justice (DOJ) in December 2023. The exchange has also been accused of allowing market manipulation on its platform, as reported by The Wall Street Journal (WSJ). Insiders and internal records have provided evidence for these allegations. However, Binance vehemently denies the accusations and reiterates its commitment to adhering to strict market monitoring rules.
Overall, these recent developments pose significant problems for Binance in crucial regions, exacerbating its already troubled situation.