These 100,000 suspicious transactions that Binance should have (also) reported

It is not enough to do, it was necessary to do everything. According to the American justice system, Binance, the leader of crypto-asset exchange platforms, has largely failed in its obligations to report suspicious transactions. This is one of the reasons for the colossal fine of $ 4.3 billion that has just been pronounced against the firm.

The punishment was accompanied by the forced resignation of his charismatic boss Changpeng Zhao, who pleaded guilty to end the prosecution. The judicial communiqué thus indicates the transit on Binance for the purpose of laundering ”hundreds of millions of dollars” doubtful.

These flows came from ransomware gangs, online black markets or various scams. Certainly, as the American justice reports, Binance has indeed asked its users to fill in their identity. But only from August 2021, and leaving former customers who are too discreet the opportunity to make transactions until May 2022.

Communication efforts

However, in recent years, Binance had spared no effort to show that it cooperated with the police around the world to detect illicit crypto flows. This cyber policeman from the center for the fight against digital criminalities, met in June 2022, moreover, believed that the platform was complying well with its regulatory obligations.

Changpeng Zhao’s firm had in particular told in June 2021 how it had contributed to the investigation on Fancycat. This gang was suspected of having laundered more than $500 million in ransoms. The company had explained that it had identified suspicious activity.

She had then found, with companies specialized in investigating the TRM Labs and Crystal blockchain, links with the Petya ransomware and the Cl0p cybercriminals group. In France, several court cases had also been facilitated by the cooperation of Binance. As for example the Platypus case, this siphoning of a decentralized finance platform that is being judged in Paris.

Important flows

However, these successes were obviously the tree that hid the forest. The indictment that has just been unveiled mentions, for example, the transfer from the Hydra black market to Binance of the equivalent of $ 106 million in bitcoins between August 2017 and April 2022. Transfers issued however by a small number of addresses, while the bad reputation of the black market was no longer to be done.

Likewise, for a year, the flows to the BestMixer mixer were also particularly intense, with a volume amounting to 275 million dollars. Exchanges finally stopped by the closure of this service by the Netherlands, in May 2019.
The Treasury statement finally emphasizes that Binance, already pinned on this topic by Reuters, had not reported many transactions related to ransomware gangs.

This kind of cybercriminals, the digital scourge of the moment, would have laundered several million dollars of ransoms linked to at least 24 different strains of malicious programs on the platform. That is to say in all more than 100,000 suspicious transactions that went way too easily under Binance’s radar, and which now earn it this colossal fine.