- FIU India fined Binance $2.2 million for non-compliance with anti-money laundering regulations.
- Binance faces global regulatory challenges, including significant fines in Canada and the US.
The Indian Financial Intelligence Unit (FIU) has fined Binance, the biggest crypto exchange in the world, INR 188.2 million ($2.2 million) for failing to abide by anti-money laundering regulations.
With reference to the Prevention of Money Laundering Act (PMLA) of 2002, India has taken a strict stance on regulating virtual digital asset service providers (VDASPs).
🚨 BREAKING: 🇮🇳 FIU-India imposes ₹18.82 Crore ($2.2M) penalty on #Binance for violating PMLA obligations 😳 pic.twitter.com/R6ZkiS76Vj
— Keyur Rohit (@CryptoKingKeyur) June 20, 2024
According to an earlier ETHNews report, Nigerian authorities have accused Binance of facilitating over $26 billion in illicit transfers, which has exacerbated the country’s financial instability.
Binance Non-Compliance with PMLA
According to the FIU-India Director, Binance operated in India without fulfilling its PMLA legal requirements.
The order requires Binance to improve its compliance procedures in line with the PMLA and its 2005 regulations, which are intended to stop terrorist funding and money laundering, after an extensive examination of Binance’s submissions.
The Indian government is determined to implement strict anti-money laundering laws, as this ruling highlights.
The Indian fine is a component of a bigger effort to make sure foreign exchanges follow local laws. The first offshore crypto companies to register with the FIU were recently Binance and KuCoin, in line with what ETHNews previously disclosed.
In a field where Indian authorities stress the need of rigorous anti-money laundering compliance, this is a critical step. The drive for registration started in December 2023, when FIU-IND sent notifications to nine offshore cryptocurrency exchanges, including Binance.
Actions Taken by Tech Giants
Users went to compliant Indian exchanges when Apple deleted non-compliant platforms from its App Store and the IT Ministry shut down their websites at the same time.
This action emphasizes the coordinated attempts of the public and commercial sectors to impose regulatory compliance in the crypto industry.
Beside that, the Financial Transactions and Reports Analysis Centre of Canada (Fintrac) has imposed a $4.4 million fine on Binance, which it is contesting in the interim.
The agency pointed to non-reporting significant virtual currency transactions and issues registering as a foreign money services company. According to Binance, its Canadian operations were small and merely coincidental to its worldwide footprint.
Following a number of regulatory setbacks for Binance, including a sizable $4.3 billion US settlement for sanctions and anti-money laundering infractions, comes this appeal.