Canadian regulator fines Binance $4.4M for AML and CFT violations

Canada's Financial Transactions and Reports Analysis Center (FINTRAC) has announced that it will impose an administrative fine of $4.4 million on Binance for failing to record and report large transactions in digital assets.

In a May 9 announcement, FINTRAC said it had imposed penalties on Binance Holdings Limited for non-compliance with Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations. According to the regulator, Binance failed to register as a foreign currency services business and reported digital currency transactions of more than $10,000.

At the time of publication, FINTRAC said it had fined Binance 6,002,000 CAD, or about $4.4 million. The regulator reported that Binance's moves to comply with the fine come as it is winding down operations in Canada by 2023. Cointelegraph reached out to Binance for comment but did not receive a response at the time of publication.

Binance announced plans to exit the Canadian market in May 2023, citing regulatory concerns. FINTRAC reported 5,902 separate transactions of $10,000 or more in crypto on the exchange from June 2021 to July 2023.

“Binance Holdings Limited has been given multiple opportunities to register as an FMSB by FINTRAC but has not completed their registration by the deadline,” FINTRAC said. “It should be noted that Binance Holdings Limited is considered an FMSB and will be required to register with FINTRAC until September 25, 2023, when it officially ceases all operations in Canada. Until that date, Binance Holdings Limited had breached its registration requirements.

Related: Canada to Begin Implementing Global Crypto Tax Reporting Standard

The $4.4 million fine was unlike any legal entanglement Binance has faced or is currently facing in other jurisdictions. In the year In November 2023, the company filed a $4.3 billion fine with authorities in the United States. Changpeng Zhao resigned as CEO as part of the deal and pleaded guilty to one count of criminal mischief. He was subsequently sentenced to four months in prison.

In Nigeria, two Binance executives were arrested in February and charged with tax evasion and money laundering. One of them is said to have escaped to Kenya, but Interpol has indicated that he is ready to extradite him to Nigeria and the court case is expected to continue on May 17.

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