Binance Fined $2.25 Million for AML Violations in India

Big trouble for Binance in India!

Binance, the world’s leading blockchain and cryptocurrency platform, has been slapped with a hefty fine of Rs 18.82 crore ($2.25 million) by India’s Financial Intelligence Unit (FIU) for failing to comply with anti-money laundering (AML) regulations. This fine is critical for Binance to resume its operations in the country.

Here’s more about this.

Regulatory Crackdown

The trouble for Binance began with a notice in December 2023, leading to its registration with the FIU in May this year. Alongside Binance, eight other offshore exchanges, including KuCoin and Huobi, faced similar scrutiny for not following local regulations.

According to the Director of FIU-India, Binance was found operating in India without meeting the stringent requirements of the Prevention of Money Laundering Act (PMLA). Despite submitting documents during a thorough review, Binance fell short of meeting important AML guidelines.

Steps Towards Compliance

To rectify these issues and prevent future breaches, Binance has been given specific directions to ensure strict adherence to Chapter IV of the PMLA of 2002 and the PMLA Maintenance of Record Rules of 2005. These rules are crucial for preventing money laundering and terrorist financing activities.

Global Regulatory Challenges

The fine imposed on Binance is part of a broader effort to align international exchanges with local regulations. Earlier this year, the Indian government took action by blocking these exchanges’ websites and removing their apps from platforms like Google and Apple.

Binance and KuCoin’s recent registration with the FIU is a significant milestone, indicating their commitment to meeting India’s stringent AML compliance requirements.

Legal Battles Around the World

Beyond India, Binance faces regulatory challenges worldwide. Earlier this year, former CEO Changpeng Zhao was sentenced to four months in prison in the United States for violating anti-money laundering laws. Additionally, Binance is currently appealing a $4.4 million fine in Canada for failing to register as a foreign money services business and report large virtual currency transactions.

This appeal follows a significant $4.3 billion settlement in the United States over similar violations, which led to Binance exiting the Canadian market last year.

Also Read: Nigerian Court Dismisses Human Rights Lawsuit by Binance Executive Nadeem Anjarwalla