Nigeria Sues Cryptocurrency Firm Binance for Tax Evasion

On Monday, Nigerian authorities charged cryptocurrency exchange Binance with four counts of tax evasion and said it was seeking collaboration with Interpol to arrest a company official who fled custody last week.

The charges arose from an investigation by the company's Nigerian office into alleged attempts to manipulate Nigeria's currency.

Nigeria's Federal Inland Revenue Services said on Monday that Binance had violated four tax laws by failing to pay corporate income tax, failing to pay value-added tax, failing to comply with tax return filing obligations, and facilitate tax evasion for Binance users.

The government also said that Binance had not registered for tax purposes with the authorities.

Binance has in the past denied any wrongdoing in Nigeria. The company did not respond to VOA's request for comment.

On February 26, Nigerian authorities arrested two of the company's executives: Tigran Gambaryan, a US citizen, and Nadeem Anjawalla, a British Kenyan.

Eze Onyekpere, founder of the Center for Social Justice, said the arrests and charges were largely expected.

"It should not be surprising that they violated Nigerian laws," Onyekpere said. "Nigeria is not the only country that has been accusing executives of violating its laws. The only reasonable thing to do is to take them to court and give them a chance to defend themselves. Due process and a fair hearing must be followed."

Meanwhile, on Monday, the national security adviser's office said Anjawalla had escaped detention. The security adviser said authorities were working with international police to obtain an arrest warrant.

Binance said it was aware that one of its officials was no longer in custody.

Nigerian authorities introduced bold reforms last year, including currency controls, in a bid to boost the economy.

But months after its implementation, the naira lost about 70 percent of its value. Authorities say companies like Binance played a role in trying to manipulate the currency.

But public finance expert Isaac Botti said this could not have happened if the government had not been so negligent towards companies like Binance that exploited the system for their benefit.

"Our system has been designed to be porous and this is the advantage these guys get," Botti said. "They understand the system. In a healthy climate, you don't create room for this type of porosity in the system."

Earlier this month, Binance ended all transactions and transactions in Nigeria's local currency and said any remaining balance would automatically be converted into Tether, a stablecoin cryptocurrency pegged to the US dollar.

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