Binance, the popular cryptocurrency exchange, has been fined 188.2 million rupees ($2.25 million) by India’s Financial Intelligence Unit (FIU) for violating the country’s Anti-Money Laundering (AML) regulations. As a Virtual Digital Asset Service Provider (VDA SP), Binance is required to maintain and report transaction records, as well as implement robust AML measures. However, the FIU investigation found that Binance failed to meet these obligations, leading to show-cause notices and a ban on the exchange and other offshore exchanges in January 2024.
The FIU’s decision was made after considering written and oral submissions from Binance’s director. The order outlined several violations, including the failure to maintain transaction records and inform authorities, which are mandated under the PMLA and related rules.
This is not the first time Binance has faced regulatory actions. In May, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) imposed a $4.4 million administrative penalty on Binance for failing to register and report large digital asset transactions. FINTRAC alleged that Binance did not register as a foreign money services business and did not report transactions exceeding $10,000. Binance has appealed against these allegations of noncompliance with AML and Countering the Financing of Terrorism regulations.
In addition, Nigerian authorities detained two Binance executives in February 2024 over allegations of tax evasion and money laundering. These incidents highlight the growing regulatory scrutiny faced by Binance and other cryptocurrency exchanges worldwide.
