Binance will be closely monitored to ensure it complies with financial regulations
The Department of Justice (DOJ) has mandated that Binance, the world’s largest cryptocurrency exchange, remain under regulatory review by the Forensic Risk Alliance (FRA) for a period of three years. This directive follows a series of investigations that revealed Binance’s involvement in anti-money laundering activities, unlicensed money transmitting and sanctions violations.
We asked @TheJusticeDept and Judge Kaplan to hold co-conspirators accountable at SBF’s sentencing
Sullivan and Cromwell were the lead to monitor Binance
DOJ has now picked Forensic Risk Alliance to monitor Binance
Well done to every FTX customer for all the victim impact… pic.twitter.com/DuDjaAr8F3
— Sunil (FTX Creditor Champion) (@sunil_trades) May 10, 2024
The appointment of the FRA, an international consultancy firm, as the outside monitor for Binance signifies the DOJ’s intent to ensure strict compliance with the plea agreement. The monitorship will grant the firm access to Binance’s internal records, facilities, and personnel, enabling thorough reporting on the company’s adherence to legal and regulatory standards.
The resolution, which includes the largest corporate penalty in a criminal matter, amounts to $4.3 billion in fines and forfeiture, reflecting the gravity of the offenses and the DOJ’s commitment to enforcing financial laws and regulations.
As part of the DOJ’s resolution, Binance is required to file suspicious activity reports and review past transactions to report any dubious activities to federal authorities. This measure aims to enhance the government’s ability to investigate and prevent illicit cyber activities and terrorism financing, particularly those involving cryptocurrency exchanges.
This extensive monitoring, which also involves five years of oversight by the Financial Crimes Enforcement Network (FinCEN), represents an unprecedented level of scrutiny for a cryptocurrency exchange. It is expected to come at a significant financial cost to Binance but is deemed necessary to safeguard the financial system from misuse by terrorist organizations, drug traffickers, and sanctioned nation-states.
