Binance failed to halt hundreds of millions of dollars flowing through suspicious accounts even after signing a landmark $4.3 billion plea agreement with US authorities in 2023, according to a detailed investigation by the Financial Times based on leaked internal files.
The documents, which include transaction records, identity checks, device logs and internal compliance notes, show that a network of high-risk accounts continued trading despite indicators that experts say would normally trigger freezes or investigations at regulated financial institutions. These red flags included links to terror financing networks, failed know-your-customer checks, improbable login patterns and large pass-through transactions that appeared to lack clear economic purpose.
Suspicious activity after the plea agreement
Under its November 2023 settlement with US authorities, Binance pleaded guilty to criminal charges related to money laundering, banking law violations and breaches of international sanctions. As part of the agreement, the exchange committed to tightening transaction monitoring, sanctions controls and customer due diligence.
However, the FT’s review of internal data covering the period from 2021 to this year raises questions about how effective those reforms have been. Thirteen accounts examined by the newspaper were involved in transactions totalling $1.7 billion, with $144 million occurring after the plea agreement was signed.
Several of these accounts continued to move eight- and nine-figure sums in patterns compliance specialists described as highly suspicious. In some cases, accounts were accessed from locations on opposite sides of the world within hours, a physical impossibility that would normally prompt immediate investigation.
Links to terror finance networks
The files show that all 13 accounts received funds that had passed through wallets later frozen by Israel under anti terrorism laws. About $29 million in the Tether stablecoin flowed into the network between February 2022 and March 2023 from wallets later linked to Tawfiq Al Law, a Syrian accused by US authorities of moving money for Hizbollah, the Iran-backed Houthis in Yemen and a company tied to the Assad regime.
Those wallets were seized by Israel in May 2023, and Al Law was sanctioned by the US Office of Foreign Assets Control in March 2024. While Binance’s lawyers argue that the wallets were not designated at the time of the transfers, experts told the FT that interaction with later sanctioned entities should still raise serious compliance concerns when combined with other warning signs.
Accounts that defied common sense
One account reviewed was registered to a young woman in Venezuela who received more than $177 million in crypto over two years. She changed linked bank details 647 times in a 14-month period, cycling funds through nearly 500 different accounts across the Americas.
Another account, held by a junior bank employee living in a low-income neighbourhood in Caracas, moved $93 million while showing logins from Caracas and Osaka within hours of each other.
“That qualifies as suspicious,” said Stefan Cassella, a former federal prosecutor specialising in money laundering, who noted that the behaviour resembled that of an unlicensed money transmitting business.
Binance rejects the findings
Binance has strongly rejected the framing of the Financial Times investigation and defended its compliance systems.
“We take compliance seriously and reject the framing of the Financial Times report,” the company said in a statement.
“Transactions are assessed based on information available at the time. None of the wallets referenced were sanctioned when the activity referenced by the Financial Times occurred,” Binance added.
The exchange said it operates “under the highest standards of AML, sanction screening, and law enforcement cooperation,” and stressed that since 2023 it has functioned under independent monitorship oversight.
“Binance complies with all relevant financial sanctions. Compliance and user safety remain our highest priority,” the company said.
Political context and regulatory questions
The investigation comes at a sensitive time for the crypto industry. In October, US President Donald Trump pardoned Binance founder Changpeng Zhao for his role in willful violations of US anti-money laundering laws. The Trump family has since expanded business ties with Binance through the crypto venture World Liberty Financial.
Critics argue that the pardon weakened incentives for strict enforcement. Jessica Davis, a former Canadian intelligence official specialising in terrorist financing, told the FT that such actions send a signal that money laundering enforcement is no longer a top priority, reducing the deterrent impact of even billion-dollar fines.
The US Department of Justice and Treasury appointed independent monitors in 2024 to oversee Binance’s compliance with its plea agreement. A significant portion of the transactions reviewed by the FT occurred after those monitors were in place, raising fresh questions about regulatory oversight.
The FT’s findings do not establish deliberate wrongdoing by Binance after the plea agreement. But they point to a continuing gap between formal compliance commitments and how suspicious activity appears to have been handled in practice, at a time when crypto platforms are becoming central to the global financial system.
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