DOJ Investigates Binance Again After $4.3 Billion Settlement
Federal prosecutors are reviewing whether Binance violated the terms of its 2023 settlement, with a focus on sanctions, money laundering, and compliance.
Key Takeaways
- U.S. federal prosecutors are investigating whether Binance violated the terms of its $4.3 billion settlement from 2023.
- The DOJ is looking, among other things, at possible involvement in Iranian payment flows, suspicious transactions, and suspected sanctions violations.
- Binance says it has closed or removed involved accounts and companies, while the outcome of the investigation is still unclear.
Binance is once again under the microscope of U.S. justice officials. Federal prosecutors are investigating whether the world’s largest crypto exchange violated the terms of the $4.3 billion (€3.8 billion) settlement the company reached in 2023.
According to Bloomberg, Tysen Duva confirmed, head of the Justice Department’s Criminal Division, on October 9 that Binance’s compliance is being reviewed. That comes less than three years after Binance and founder Changpeng Zhao pleaded guilty in a major U.S. case. The settlement included a $3.4 billion (€3 billion) fine to FinCEN, a $50 million (€44.6 million) personal fine for Zhao, and a five-year compliance monitoring period.
Three Cases Are Drawing Attention
The first concern centers on a suspected Iranian payment network. The Wall Street Journal reported that accounts linked to financier Babak Zanjani processed about $850 million (€759 million) through Binance. In another recent case, suspicious transactions from a VIP customer drew the attention of U.S. and Swiss authorities. Binance says it closed those accounts.
That was followed in September by a $61 million forfeiture case. Prosecutors say two Chinese companies, Blessed Trust and Hexa Whale, used Binance accounts to launder proceeds from Iranian oil sales. According to the indictment, the broader network totaled more than $1.5 billion (€1.3 billion). Binance says it investigated and removed both companies.
A third issue is Binance’s response to suspected sanctions violations. Earlier reports had already suggested that prosecutors were checking whether the exchange knowingly allowed banned transactions. The DOJ has not said which incidents are specifically part of the new review.
What This Means for Binance
A look at earlier cases shows that violating a U.S. deal does not automatically lead to the same outcome. Ericsson received extra oversight and a new fine after breaking its agreement, while Boeing later even managed to strike a new deal. Binance is different from those examples, though, because the company already pleaded guilty in 2023.
For European crypto readers, the main takeaway is that this case once again shows how closely U.S. regulators watch sanctions, anti-money-laundering rules, and compliance at major crypto exchanges. Binance still plays a central role in the global crypto market, so every new DOJ step also gets attention outside the U.S. That also matters in Europe, where Binance is already clashing with MiCA regulators in Europe over the question of how the company can continue serving customers.
Possible Outcomes
Based on earlier cases, several outcomes are possible, from tighter oversight to additional fines or new criminal steps. A negotiated solution seems more likely right now than a direct intervention in Binance’s operations, although a lot depends on what prosecutors can actually prove.
The core question remains simple: what did Binance know about the suspicious activity, and how quickly did the company act?
