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Binance Under DoJ Probe for Possible Russian Sanctions Violations

Tim Fries

Published: May 5, 2023 10:17 pm

Last Updated: May 8, 2023 12:19 pm

According to a report from Friday, May 5th, Binance is currently under a Justice Department investigation for possible violations of sanctions placed on Russia. The cryptocurrency exchange has not been accused of any wrongdoing at this point. It is also under a DoJ probe for alleged violations of sanctions against Iran since July 2022.

Binance Facing Justice Department Investigation For Possible Sanctions Violations

The Justice Department is reportedly investigating the world’s largest cryptocurrency exchange Binance for possible violations of sanctions imposed on Russia. The sanctions were placed on the country due to its invasion of Ukraine in February 2022. Binance imposed limits on Russian accounts already last April.

According to the report from Friday, the cryptocurrency exchange is yet to be accused of any wrongdoing. It has also been under another DoJ investigation since the summer of 2022 and has been accused of helping Iranian exchanges bypass the sanctions placed upon the Middle Eastern country and is reportedly working with the authorities to resolve the matter.

Near the end of April 2023, some Russian outlets reported that Binance has lifted some of the limitations placed on customers within the country. For example, it allegedly again started accepting transactions from cards issued by Russian banks enabling their holders to top up their accounts using rubles.

US Authorities Increase Efforts to Curtail Crypto-Related Sanctions Violations

The increase in popularity of cryptocurrencies also brought an increase in their use for various forms of illicit activity. One of the long-standing concerns has been that they could be used by sanctioned nations to bypass the restrictions and use them to covertly access the global financial system. While the FBI downplayed the risk of Russia using digital assets to evade sanctions in March 2022, several subsequent reports have sparked concerns.

Still, the majority of alleged sanctions violations with the help of digital assets pertain to North Korea. Last summer, a cryptocurrency mixer called Tornado Cash was blacklisted in what became one of the most controversial OFAC decisions and even led to a lawsuit filed by an advocacy group. More recently, the DoJ pressed charges against a China-based North Korean national for helping launder stolen digital assets to help fund the country’s weapons program.

Binance has repeatedly been a target for numerous alleged deficiencies in its compliance mechanisms. Earlier this year, the CFTC sued the exchange alleging it had solicited US-based customers without proper licenses and failed to do enough to prevent cybercriminals from using its platform. Earlier this week, it was reported that Israeli authorities have seized hundreds of Binance accounts connected to ISIS’ terrorist activity.

This article originally appeared on The Tokenist