DOJ Examines Binance Role in Suspected Sanctions Evasion

TLDR

• The U.S. Department of Justice has opened an investigation into Binance over suspected Iran-linked transactions.
• Investigators are reviewing more than $1 billion in transfers reportedly connected to Iran-backed groups.
• Binance’s internal compliance team flagged about $1.7 billion in transactions from Chinese clients.
• A Hong Kong firm called Blessed Trust allegedly routed over $1 billion through the exchange.
• Lawmakers urged federal agencies to examine Binance accounts tied to the Houthis and the Islamic Revolutionary Guard Corps.

The U.S. Department of Justice (DoJ) has opened a probe into transactions routed through Binance. Authorities are examining whether Iran used the exchange to bypass U.S. sanctions. Investigators are reviewing transfers allegedly linked to the Islamic Revolutionary Guard Corps and the Houthis.

Officials have contacted individuals familiar with the transfers to request interviews and records. The Wall Street Journal reported that the probe focuses on funds that moved through digital wallets tied to Iran. Prosecutors have not stated whether they are targeting the exchange or specific users.

Lawmakers have also urged federal agencies to review the transactions in question. A Treasury-appointed monitor has requested documents related to the flagged transfers. The investigation follows prior legal scrutiny involving the crypto platform and its leadership.

Binance Compliance Review and Flagged Transfers

Internal compliance staff at Binance identified about $1.7 billion in transfers from Chinese clients. Those funds allegedly moved into wallets linked to Iran’s regional proxies. Employees escalated their findings to senior leadership before the company suspended them in November.

A Hong Kong-based firm called Blessed Trust reportedly sent more than $1 billion through the exchange. Investigators are examining whether that firm facilitated transfers connected to Iran-backed groups. Authorities are also reviewing how Binance’s compliance systems handled those alerts.

Court records show that Judge Jeannette Vargas recently cleared Binance and Changpeng Zhao of terrorism financing claims. She ruled that 535 plaintiffs failed to plausibly allege direct responsibility for violence. However, the current probe focuses on separate alleged sanctions violations.

Lawmakers Press DOJ as Treasury Monitor Seeks Records on Binance

Eleven U.S. Senators, including Chris Van Hollen and Elizabeth Warren, backed a letter urging a federal probe. They stated that investigators found at least two Binance accounts tied to Iran-backed entities. The letter claimed those accounts supported the Houthis and the Islamic Revolutionary Guard Corps.

Lawmakers argued that the transactions could conflict with Binance’s 2023 settlement with U.S. authorities. They said the reported transfers may undermine prior compliance commitments. Federal officials have not confirmed the scope of any potential enforcement action.

The Treasury Department’s compliance monitor has sought detailed documentation about the Iranian-linked transfers. Sources said regulators requested records on Blessed Trust’s role in moving funds. Investigators are determining whether sanctions laws were violated and how the funds traveled through the platform.

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