Canadian regulator fines Binance $4.4m for money laundering violations

FINTRAC has imposed a significant fine on cryptocurrency exchange Binance for allegedly violating anti-money laundering regulations.

In a statement released today, Canada’s Financial Transactions and Reports Analysis Center (FINTRAC) outlined two key violations: failing to register as a foreign currency services business and neglecting to report significant transactions in virtual currency.

Specifically, FINTRAC alleges that Binance failed to declare transactions exceeding $10,000 on 5,902 separate occasions between June 2021 and July 2023.

“Binance is committed to becoming a foreign exchange services company. The regulator stated that an administrative fine of $6,002,000 was imposed on Binance Holdings Limited on May 7, 2024, for 2 violations.

The penalty of $4.4 million, or C$6 million, stems from compliance checks performed in 2023.

FINTRAC is Canada’s financial intelligence unit that prevents money laundering and other financial crimes. Using blockchain analytics, he found that Binance’s failure to report virtual currency transactions was vital to transparency in the financial system.

The development follows similar regulatory scrutiny that Binance has faced in the US. In November 2023, the U.S. Department of Justice reached a plea agreement with the exchange that included a $4 billion settlement over alleged money laundering and sanctions violations.

Part of the settlement required Binance founder and then-CEO Changpeng Zhao to resign and pay a $50 million fine. Zhao was later sentenced to four months in prison after pleading guilty to violating anti-money laundering regulations.