The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has announced that it will impose a hefty fine of $4.4 million on Binance for its failure to comply with regulations regarding the registration and reporting of large digital asset transactions.
In a notice issued on May 9, FINTRAC stated that Binance Holdings Limited had been penalized for its noncompliance with Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations. The regulator found that Binance had neglected to register as a foreign money services business and failed to report digital currency transactions exceeding $10,000.
The fine imposed on Binance amounted to 6,002,000 CAD, equivalent to approximately $4.4 million at the time the announcement was made. FINTRAC revealed that Binance had committed these infractions in 2023, during a period when the company was winding down its operations in Canada. Cointelegraph reached out to Binance for a comment, but no response was received as of the time of publication.
It is worth noting that Binance had already disclosed its intentions to exit the Canadian market in May 2023, citing concerns over regulatory matters. From June 2021 to July 2023, FINTRAC reported a total of 5,902 separate transactions on the Binance exchange involving amounts of $10,000 or more in cryptocurrency.
“Despite being provided with multiple opportunities to register with FINTRAC as an FMSB, Binance Holdings Limited failed to complete the registration process within the specified deadlines,” stated FINTRAC. “It should be emphasized that Binance Holdings Limited was considered an FMSB and was required to be registered with FINTRAC until September 25th, 2023, when it formally ceased all operations in Canada. Until that date, Binance Holdings Limited was in violation of its registration obligations.”
In addition to the $4.4 million penalty imposed by FINTRAC, Binance has also faced legal challenges in various jurisdictions. In November 2023, the company reached a settlement with authorities in the United States, resulting in a payment of $4.3 billion in penalties. As part of the agreement, Changpeng Zhao stepped down as CEO and pleaded guilty to one felony charge, leading to a four-month prison sentence.
Meanwhile, in Nigeria, two Binance executives were arrested in February on charges of tax evasion and money laundering. Although one of the individuals reportedly fled to Kenya, Interpol has expressed its readiness to extradite him back to Nigeria, where court proceedings are scheduled to resume on May 17.
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