FINTRAC has imposed a substantial fine on cryptocurrency exchange Binance for allegedly violating anti-money laundering regulations.
In a release issued today, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) outlined two primary violations: failure to register as a foreign money services business and neglect to report significant transactions in virtual currency.
Specifically, FINTRAC claims that Binance did not declare transactions exceeding $10,000 on 5,902 separate occasions between June 2021 and July 2023.
“Binance is determined to be a foreign money services business. Binance Holdings Limited was imposed an administrative monetary penalty of $6,002,000 on May 7, 2024, for committing 2 violations,” the regulator stated.
The penalty, $4.4 million, or 6 million CAD, stems from compliance checks conducted in 2023.
FINTRAC is Canada’s financial intelligence unit, preventing money laundering and other financial crimes. Using blockchain analytics, it identified Binance’s oversight of failing to report virtual currency transactions as crucial for transparency in the financial system.
The development follows similar regulatory scrutiny Binance faced in the United States. In November 2023, the U.S. Department of Justice reached a plea deal with the exchange, involving a $4 billion settlement for alleged money laundering and sanctions violations.
Part of the agreement required Binance founder and then-CEO Changpeng Zhao to step down and pay a $50 million fine. Zhao subsequently received a four-month prison sentence after pleading guilty to violating anti-money laundering regulations.