Binance France Under Investigation for Money Laundering Charges

French authorities have launched a judicial investigation into Binance. The largest crypto exchange is being accused of money laundering, tax fraud, and drug trafficking.

Binance secured regulatory approval in France in May 2022, becoming a registered Digital Asset Service Provider (DASP) under the oversight of the Autorité des Marchés Financiers (AMF).

Legal Troubles Continue for Binance

Despite its registration, regulators now accuse the exchange of breaching its obligations as a DASP. The investigation could potentially lead to criminal charges against the company.

The allegations in France mirror those Binance and its former CEO Changpeng Zhao (CZ) faced in 2023 from the US Department of Justice. That case concluded with Binance paying a record $4 billion fine and CZ stepping down. 

However, similar regulatory scrutiny now looms over the exchange in France. This marks another significant regulatory challenge for Binance. 

“The offences relate to the period from 2019 to 2024 and include activities in France and the EU. The investigation, initiated after user complaints about financial losses and misleading information, revealed that Binance was neither registered nor licensed by the AMF at the time. Furthermore, Binance allegedly ran advertisements through influencers before its legal registration, in violation of French laws,” wrote local reporter Grégory Raymond.

The exchange continues to face mounting lawsuits and criminal allegations globally.

Adding to the scrutiny, Binance transferred $20 million worth of BTC, ETH, and SOL to Wintermute earlier today. Critics argue that Wintermute engages in market manipulation by using artificial liquidity to exploit retail investors unfairly. 

The exchange also faced similar allegations before for listing low market-cap meme coins. 

In the US, the Supreme Court recently ruled that a class-action lawsuit against Binance can proceed. Former investors allege the company sold unregistered tokens illegally.

In a separate case in the UK, Binance faces legal action from a former senior employee. Amrita Srivastava claims she was wrongfully dismissed from the company. 

This allegedly happened after she reported that a colleague solicited a bribe from a customer in exchange for favorable treatment. The lawsuit, filed last November, has added to the exchange’s legal troubles.

Overall, regulatory actions against centralized exchanges are intensifying. Yesterday, KuCoin admitted to operating an unlicensed money-transmitting business in the US. 

Founders Chun Gan and Ke Tang agreed to pay nearly $300 million in fines, avoiding prison.

French authorities are yet to provide more details of the Binance investigation. However, it’s not a positive outlook for the largest crypto exchange.