Binance is defending its sanctions program after Reuters reported Monday (July 11) that the cryptocurrency exchange processed trades by clients in Iran despite United States sanctions against the country and a company ban on conducting business there.
Binance told PYMNTS Monday morning that its sanctions program is “fully compliant with all international financial sanctions, including blocking platform access to users in Iran, North Korea, among many others.”
The company said it had also “implemented advanced detection tools that allowed us to further crack down on users in sanctioned regions that had access to sophisticated masking tools including VPNs.”
Citing interviews with seven traders, Reuters reported that Binance told traders in November 2018 that it would no longer serve them and ordered them to liquidate their accounts. That move followed the U.S. decision to reinstitute sanctions against Iran that had been lifted as part of the nuclear deal.
However, the traders told Reuters they got around the ban and used their Binance accounts until September 2021. They lost access when Binance strengthened its anti-money laundering (AML) measures. Before that, customers could trade simply by registering with an email.
“There were some alternatives, but none of them were as good as Binance,” said Asal Alizade, a trader in Tehran, per the report. “It didn’t need identity verification, so we all used it.”
Binance senior employees knew — and joked — about the exchange’s popularity in Iran, according to the report, which cited messages that circulated among staff in 2019 and 2020.
Last month, a French Member of the European Parliament (MEP) called on her country’s market regulator to review its approval of the Binance cryptocurrency exchange, citing reports of possible money laundering activity on the platform.
Binance questioned those reports, arguing it was building “the most sophisticated cyber forensics team on the planet.”
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