TLDR
- Binance is under a new US Justice Department investigation over possible Iran sanctions violations, Bloomberg reported September 22.
- The probe is led by the Manhattan US Attorney’s Office along with the DOJ’s Criminal Division in Washington.
- The investigation follows a separate $61 million civil forfeiture case tied to Iranian oil proceeds allegedly moved through Binance accounts.
- Binance says it has a zero-tolerance policy on sanctions violations and is cooperating with law enforcement.
- Binance pleaded guilty to sanctions and anti-money laundering violations in 2023 and paid over $4.3 billion in penalties.
Binance is facing a new US federal investigation into whether it violated sanctions on Iran. Bloomberg News reported the news on September 22.
The Manhattan US Attorney’s Office is leading the probe. The Justice Department’s Criminal Division in Washington is also involved.
Prosecutors are looking into whether Binance allowed trading activity that should have been blocked under US sanctions law. The specific transactions have not been made public.
Neither the Justice Department nor the Manhattan US Attorney’s Office has commented on the investigation.
What Prosecutors Are Examining
The investigation centers on whether Binance’s compliance systems failed to stop transactions connected to Iran.
Bloomberg reported that authorities are trying to determine if Binance knowingly allowed this trading. The report did not say when the investigation started.
Binance responded with a statement saying it has a zero-tolerance policy toward sanctions violations. The company said it fully cooperates with law enforcement.
No charges have been announced against Binance related to this investigation. A federal probe can end without any charges being filed.
The $61 Million Forfeiture Case
This investigation comes days after prosecutors in Manhattan filed a separate civil forfeiture complaint. That case targets about $61 million in crypto tied to Iranian oil sales.
The complaint names two Chinese companies, Blessed Trust and Hexa Whale. Prosecutors say these firms used Binance’s UAE-based exchange to launder proceeds from Iranian oil.
The Justice Department says the wider network moved more than $1.5 billion in alleged Iranian oil proceeds through crypto addresses. Officials say the money was meant to reach the Iranian government and groups including the Islamic Revolutionary Guard Corps.
Binance co-CEO Richard Teng said the exchange was not named as a defendant in that case. He said Binance did not permit transactions with sanctioned individuals.
Teng said the company investigates and freezes accounts when needed. He added that Binance reports suspicious activity to authorities.
This new investigation is separate from the forfeiture case. The allegations in that civil case have not been proven in court.
Binance’s 2023 Guilty Plea
Binance has dealt with sanctions issues before. In November 2023, the company pleaded guilty to federal charges covering anti-money laundering failures and sanctions violations.
Binance agreed to pay more than $4.3 billion in penalties. Founder Changpeng Zhao also pleaded guilty and stepped down as CEO.
The Justice Department said Binance knew it had users in Iran and the US. Officials said the company failed to stop these users from trading with each other.
That resulted in more than $898 million in trades between US and Iran-based users from January 2018 to May 2022.
Binance agreed to improve its compliance program. The company accepted an independent monitor for three years as part of that deal.
Wider Enforcement on Iran
The US government has increased pressure on networks it says help Iran move money. The Treasury Department recently launched an effort called Operation Economic Outcast to expand sanctions on Iran.
Earlier this month, the US also sanctioned companies and individuals accused of supporting Hezbollah and other Iranian-backed groups.
Binance users have not been told to take any action. The investigation concerns the company’s compliance systems, and no wrongdoing has been proven.
