The U.S. Department of Justice's national security division is conducting an inquiry into whether Binance allowed Russian customers to access the exchange in violation of U.S. sanctions related to Russia's invasion of Ukraine, according to a Bloomberg report that cites five people familiar with the matter.
The Justice Department inquiry is another high-profile action against Binance after a 2021 joint investigation with the Internal Revenue Service against the global exchange. The U.S. Securities and Exchange Commission (SEC) has also been investigating Binance for its relationship with two firms owned by its founder Changpeng Zhao since at least early 2022.
Spokespeople for Binance and the Justice Department did not immediately return CoinDesk's requests for comment.
The Justice Department declined a Bloomberg request for comment. A Binance statement to Bloomberg said the company complies fully with all U.S. and international financial sanctions.
In March, the U.S. Commodity Futures Trading Commission (CFTC) sued Binance alleging the company knowingly offered unregistered crypto derivatives products in the U.S. against federal law.
The exchange has repeatedly pushed back against allegations by saying it has built the world's largest compliance team in the space – a 700-member team that "addresses 1,300 law enforcement requests on a weekly basis," Tigran Gambaryan, Binance's head of financial crime compliance, said at CoinDesk's Consensus conference last week.
In recent days, Binance has claimed to have figured out how to keep North Koreans off its crypto exchange by kicking "their a-- enough that they're actually able to recognize that Binance was not the place for them."
Additionally, this month, Israel reportedly revealed it had seized roughly 190 Binance accounts with alleged ties to terrorist groups, including two accounts to ISIS.
"Amazing job my friends Binance," posted Amit Levin, head of the Economic Department within the Cyber Unit in the Office of the Israel State Attorney. "Continue cleaning our crypto eco-system from illegal activities."
Update (May 10, 22:20 UTC): Adds Israeli official LinkedIn post which suggests Binance did cooperate with the government.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.