Canadian Financial Watchdog Fines Binance for Compliance Failures

Binance has been found to have violated numerous regulations, according to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), underscoring the exchange’s disregard for rules.

Binance failed to register as a foreign money services firm and failed to record significant virtual currency transactions, according to a recent notice from FINTRAC. These are the two main violations that Binance committed. The regulator in question specifically claims that on 5,902 instances between June 2021 and July 2023, Binance failed to report transactions totaling more over $10,000.

Substantial Penalty Imposed

According to FINTRAC, Binance Holdings Limited has been penalized with an administrative monetary penalty of $6,002,000, highlighting the severity of the violations. This penalty, amounting to $4.4 million or 6 million CAD, originates from compliance assessments conducted in 2023.

The primary goal of FINTRAC, Canada’s financial intelligence branch, is to stop money laundering and other associated financial crimes. Through the use of blockchain analytics, the organization was able to pinpoint Binance’s neglect to disclose transactions involving virtual currencies as a crucial error, underscoring the need of openness in the financial sector.

This latest event is reminiscent of the regulatory obstacles that Binance has faced in the US. The U.S. Department of Justice and the exchange concluded a plea deal in November 2023, which resulted in a $4 billion settlement for suspected sanctions violations and money laundering.

Changpeng Zhao, the founder and CEO of Binance at the time, consented to resign and pay a $50 million fine as part of this settlement. Zhao subsequently admitted to breaking anti-money laundering laws and was sentenced to four months in jail.