![]() value for some data fields in Binance's internal database with "UNKWN", it said. In October 2020, Zhao directed Binance personnel to replace the U.S. ![]() customer base secret from some senior managers, CFTC said. Zhao kept information reflecting Binance's U.S. customers from trading on its platform, the CFTC said Binance told its commercially valuable U.S.-based "VIP customers" how to evade its compliance controls. VIP CUSTOMERS Though Binance's global business publicly said it was restricting U.S. The CFTC said when Zhao hired BAM's first CEO, he "described Binance as a pirate ship and explained that he wished for Binance.US to be a navy boat." Reuters previously reported that this American firm, BAM Trading, was in fact controlled by Zhao and managed by Binance as a de-facto subsidiary. ![]() exchange in 2019 to serve American customers in compliance with U.S. customers even after the company, in partnership with a purportedly independent American firm, launched a U.S. The CFTC's complaint detailed Binance's efforts to retain U.S. Binance did not require customers to submit information verifying their identity before trading and "failed to implement basic compliance procedures designed to prevent and detect terrorist financing and money laundering," the CFTC said. The CFTC charged the holding company and two other Binance units. With a holding company based in the Cayman Islands, Binance has never revealed the location of its core exchange. Trading volumes hit $34 trillion in 2021, Zhao said last year. Its core exchange processed trades worth about $23 trillion last year, according to data provider CryptoCompare. 'PIRATE SHIP' Founded in Shanghai in 2017, Binance sits at the heart of the global crypto industry. The fourth item on the list was "Ignore FUD, fake news, attacks," using an acronym for "fear, uncertainty and doubt" often used in crypto in relation to news perceived as negative. In a tweet on Monday afternoon, Zhao wrote "4" - a reference to a previous post listing his "Do's and Don'ts" for 2023. Binance's cryptocurrency BNB, the world's fourth largest by market size, dropped around 4% on the news. Binance has processed at least $10 billion in payments for criminals and companies seeking to evade U.S. Justice Department had been investigating Binance since 2018 for possible money-laundering and sanctions violations. Reuters reported in December that the U.S. customers' trading of such products are required to register with the agency. Firms such as brokers that facilitate U.S. CFTC Chairman Rostin Behnam said in a statement that Binance executives knew for years "they were violating CFTC rules, working actively to both keep the money flowing and avoid compliance." The CFTC is responsible for oversight of commodities and derivatives markets, including for Bitcoin. users on its platform, the spokesperson said. ![]() Binance has made "significant investments" to ensure it does not have U.S. A spokesperson for Binance, which dominates the global digital asset sector, said the firm will continue to "collaborate" with regulators. Lim did not immediately respond to calls and messages from Reuters. The CFTC also accused Binance's former Chief Compliance Officer Samuel Lim of "aiding and abetting" Binance's violations. Binance's compliance program has been "ineffective" and the firm, under the direction of Zhao, told employees and customers to circumvent compliance controls, the CFTC said, citing a number of practices first reported by Reuters in a series of investigations into the exchange last year. The CFTC said in its complaint on Monday that from at least July 2019 to the present, Binance "offered and executed commodity derivatives transactions on behalf of U.S. ![]()
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