top of page

Binance Investigated by French Authorities for Alleged 'Aggravated' Money Laundering.

France’s specialized financial judicial investigation service (JIRS) is conducting an investigation into Binance for allegations including ‘aggravated’ money laundering and illegal canvassing of clients.

Binance Investigated by French Authorities for Alleged 'Aggravated' Money Laundering.

In what seems to be a long string of setbacks for the cryptocurrency exchange, the legal challenges facing Binance continue to mount, this time from Europe. In reports that have since been confirmed by the Paris prosecutor’s office, the leading crypto exchange has been under investigation in France since early 2022.

As per a report from the French daily, Le Monde, the local branch of the cryptocurrency exchange Binance has been under scrutiny since February 2022 in an investigation carried out by the JIRS under the direction of the specialized interregional jurisdiction of Paris (SEJF), the government’s anti-financial crime wing.

The investigation reportedly centers around allegations of Binance engaging in illegal activities related to the provision of digital asset services (PSAN) and aggravated money laundering by participating in investment operations, concealing funds, converting assets, and the latter involving offenders who have generated profits through their participation in illegal activities. The reports also suggest that Binance failed to adhere to or implement proper Know Your Customer (KYC) procedures, which are designed to prevent money laundering and ensure the verification of users and their activities.

Binance’s Operations in France

While Binance chose to not provide specific comments regarding the ongoing investigations, the spokesperson mentioned that French authorities conducted an on-site visit to Binance last week and stated that the exchange is actively collaborating with regulators to ensure full compliance with all regulatory requirements.

“Binance invests considerable time and resources into cooperating with law enforcement globally. We abide by all laws in France, just as we do in every other market we operate. “ – Binance Spokesperson

Although Binance only obtained regulatory approval as a fully regulated cryptocurrency exchange in France in May last year, the exchange had been providing services in the country since 2020, according to local news reports – indicating that Binance had been operating in France prior to obtaining the official regulatory status.

A Growing Pile of Legal Trouble

The recent allegations against Binance only add to the mounting legal challenges faced by the crypto exchange, with the addition of the ongoing investigation in France, the company is contending with a lawsuit filed by the US Securities and Exchange Commission (SEC). The French investigation’s accusations of illegal operation in the country echo the charges brought up by the US SEC’s lawsuit accusing Binance of engaging in the unauthorized solicitation of customers from the United States, commingling user and corporate funds, and non-compliance with anti-money laundering regulations.

The news of Binance’s issues in France come on the same day that Binance further announced that it would be quitting the Dutch market, steeping out of the Netherlands after failing to meet the registration requirements to operate as a virtual asset service provider (VASP). A spokesperson from Binance said what while the exchange had tried "many alternative avenues" to meet Dutch registration requirements, trading in the Netherlands would have be halted starting from July 17th, with existing users from the Netherlands only retaining access to withdraw their assets from the platform.

The Dutch Central Bank (DNB), responsible for registering financial service providers in the Netherlands, had previously issued warnings to Binance regarding its operation in the country without proper registration. Subsequently, the DNB imposed fines on the company for the same violation back in January.

In addition to its decision to leave the Dutch market, Binance has recently revealed its plans to exit other regions as well. The cryptocurrency exchange previously announced plans to leave the Canadian market due to conflict with the new rules from Canadian Regulators, and recently also announced plans to leave Cyprus due to the upcoming European Union's Markets in Crypto Assets (MiCA) legislation.

bottom of page