Investigations are gathering information on money laundering and tax evasion. Binance has been used to launder ransomware funds, according to research.

The world’s largest bitcoin and cryptocurrency exchange, Binance, is bringing support and contribution to US authorities in investigations against money laundering and suspected tax offenses.

Changpeng Zhao, CEO of the company, announced this collaboration on May 13. The CZ post, as it is popularly known in the cryptocurrency ecosystem, came in response to news that Binance would allegedly be the subject of such illegal operations.

Zhao referred to the title of a Bloomberg post, according to which Binance “faces” investigations for money laundering and tax crimes in the United States. The executive assured the content does expose the company’s collaboration with US agencies in their inquiries.

Specifically, the Department of Justice and the Internal Revenue Service (IRS) of the United States of America would be leading the investigations into the exchange, according to the same medium. According to the announcement, anonymous sources with knowledge of the situation on Binance assure the legitimacy of the investigation. However, they alleged that both institutions refused to comment on the matter.

Although Zhao denies that the investigation points at his company to crimes related to money laundering or tax evasion, it is known that the platform has served as a vehicle for these purposes in the past.

Earlier this year, a large part of the bitcoins perceived by criminals who operate the Ryuk ransomware went through the laundry on Binance and the Huobi exchange.

Binance And its Link to Other Speculations

Binance relates to some other investigations and speculations about its businesses. In March of this year, the company was under the scrutiny of US authorities for allegedly bringing unauthorized services in the North American country.

The investigation could be taking into account an alleged document leaked last November, where Zhao urged the use of VPN to browse the Binance website from the US, which helped to avoid local controls. The executive denied that the alleged strategy helped evade US regulations.

Also a few weeks ago Binance entered under the scrutiny of European authorities, after launching tokens based on shares of companies on its platform to be traded. Although the matter did not escalate, the German regulator spoke about the possibility of a fine.

Binance’s position has incorporated former executives of the Financial Action Task Force (FATF) into its regulatory team; this organization leads guidelines and operations against privacy in the crypto world.

Recently, The UK’s Financial Conduct Authority (FCA) and Germany’s Federal Financial Supervisory Authority (BaFin) turned their eyes on Binance’s tradable share tokens. They studied whether or not the exchange has followed the laws of the stock market before launching the product.

Tradable share tokens are a new type of asset that Binance has brought to users of its platform since last April 12. These are tokens with a backup from shares of publicly traded companies.

By: Jenson Nuñez

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