Canada Imposes $4.4M Fine On Binance for AML, CFT Violations

From June 2021 to July 2023, FINTRAC reported that Binance facilitated 5,902 distinct cryptocurrency transactions worth $10,000 or more while failing to register with the regulator

Binance was fined $4.4 million administratively by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) for neglecting to register and report significant digital asset transactions. 

FINTRAC informed Binance Holdings Limited on May 9 that penalties had been levied in retaliation for the company’s failure to adhere to Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations.

As stated by the regulator, Binance was found to have neglected to register as a foreign money services business and to disclose digital currency transactions surpassing $10,000. 

Binance was fined 6,002,000 CAD by FINTRAC, which is equivalent to approximately $4.4 million as of the time of publication. According to the regulator, Binance committed the violations that resulted in the sanction in 2023 as the company was winding down its operations in Canada.  

 

Due to regulatory concerns, Binance announced in May 2023 that it intended to exit the Canadian market. FINTRAC reported 5,902 distinct cryptocurrency transactions worth $10,000 or more on the exchange between June 2021 and July 2023. 

FINTRAC stated, “Binance Holdings Limited was offered multiple opportunities to register as an FMSB; nevertheless, they failed to finalize their registration in accordance with the specified deadlines.”

The $4.4 million fine was imposed in a jurisdiction unrelated to any legal disputes Binance has encountered or is confronting in other areas. The settlement reached with United States authorities in November 2023 mandated the company’s payment of $4.3 billion in penalties.

Changpeng Zhao resigned as CEO in exchange for the agreement and entered a guilty plea to a single felony charge. As a result, he received a four-month prison sentence. 

Two executives of Binance were apprehended in Nigeria in February on suspicion of money laundering and tax evasion. Despite reports indicating that one of the men fled to Kenya, Interpol stated its willingness to extradite him to Nigeria, where legal proceedings are scheduled to recommence on May 17.