Binance is under investigation by the US Department of Justice's (DOJ) national security division for allowing Russians to use the cryptocurrency exchange in violation of US sanctions, according to a report that appeared in Bloomberg on May 5. There have been no charges against the company or its executive in connection with the investigation.
The national security investigation is being carried out in conjunction with an investigation by the criminal division, the news service said, citing five unnamed sources. Binance is the subject of several investigations in the U.S, including a Department of Justice inquiry in anti-money laundering violations.
Binance limited services to Russia after sanctions were imposed on the country in April 2022. Still, continued to operate thereblocking only areas of Ukraine that were no longer under government control and providing services only to unsanctioned individuals, according to a company executive who spoke to Cointelegraph.
The Justice Department is investigating whether Binance was illegally used to allow the Russians to circumvent US sanctions and move money through the world's largest cryptocurrency exchange. https://t.co/AVgG55iSmx
โBloomberg Crypto (@crypto) May 5, 2023
Binance has also been charged of Know Your Customer/Anti-Money Laundering (KYC/AML) violations in a lawsuit filed by the U.S. Commodity and Futures Trading Commission in March.
Related: Brazilian Authorities Investigate Binance For Guiding Clients Past Stop Order: Report
The company did not immediately respond to a query from Cointelegraph, but told Bloomberg in a statement that it was compliant with US and international sanctions, and that its KYC protocols are in line with those of traditional banking. Each client is subject to identity and residency checks, he said. Besides:
"Our policy imposes a zero tolerance approach to double registrations, anonymous identities and obscure sources of money."
Additionally, according to Bloomberg, Binance โhas been in discussionsโ with the Justice Department over complaints that it had violated an earlier version of sanctions against Iran.
Binance is not the only cryptocurrency exchange facing scrutiny for sanctions violations. Poloniex paid a $7.6 million settlement to the US Treasury Department's Office of Foreign Assets Control for violating sanctions against Crimea, Cuba, Iran, Sudan and Syria, according to a May 1 announcement.
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