Crime
Crypto platform Binance faces fresh Money Laundering allegations in US
More trouble for Binance as it faces another round of Money Laundering legal battles in the US
Binance, a global crypto trading platform, is the subject of a new class action lawsuit in the U.S. Western District Court of Washington. The lawsuit alleges that Binance enabled money laundering and violated U.S. financial regulations.
The lawsuit was instituted by former exchange users Philip Martin, Natalie Tang, and Yatin Khanna, who allege that Binance’s negligent compliance practices allowed fraudulent actors to use the platform to launder stolen crypto, causing significant financial harm to U.S. users.
The complaint details how Binance allegedly operated as an unlicensed money-transmitting business under the leadership of its founder, Changpeng Zhao. It willfully ignored anti-money laundering requirements and facilitated transactions that helped criminals obscure the origins of illicit funds.
The plaintiffs claim that Binance’s failure to implement robust AML and Know Your Customer protocols turned the exchange into a hub for laundering crypto, often stolen through hacks and other illicit activities.
Meanwhile, Binance announced that it had prevented over $2.4 billion in potential user losses from suspected scams and fraudulent activities in the first seven months of 2024.
This was achieved through the company’s sophisticated internal risk engine, which leverages artificial intelligence (AI) and manual review to detect and flag suspicious transactions across the platform, safeguarding over 1.2 million users. The most prevented losses, approximately $1.1 billion, were linked to suspected crypto scams during withdrawal.
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