Binance is reportedly under investigation for facilitating money laundering and tax evasion

Binance Holdings Ltd., the world’s largest cryptocurrency exchange by volume is allegedly under investigation by the U.S. Department of Justice and Internal Revenue Service on allegations that it facilitates money laundering and tax evasion.

According to a report from Bloomberg citing people with knowledge of the matter, it is claimed that officials have sought information from individuals with insight into Binance’s business. The same report claims that Binance has “succeeded largely outside the scope of government oversight” noting that Binance is incorporated in the Cayman Islands and is run out of Singapore.

The part the report ignores or intentionally misses — when Bloomberg says “government oversight” what they mean is U.S. government oversight. Singapore is not a third-world country and is the second richest country in the world according to data from Global Finance Magazine. Singapore has laws which are enforced and it can even be argued that they are over the top at times — chewing gum is famously banned in Singapore. Binance has strict government oversight just not by the U.S. government.

Binance pushed back at the investigation with spokesperson Jessica Jung saying that “we take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion.”

“We have worked hard to build a robust compliance program that incorporates anti-money laundering principles and tools used by financial institutions to detect and address suspicious activity,” Jung added.

Some Biden administration officials have an arguably strange anti-cryptocurrency fetish. Janet Yellen, the current secretary of the treasury is on the record as claiming that nearly all cryptocurrency is used for illicit purposes.

“I think many (cryptocurrencies) are used, at least in a transaction sense, mainly for illicit financing,” Yellen said at a Senate Finance Committee hearing in January. “And I think we really need to examine ways in which we can curtail their use and make sure that [money laundering] doesn’t occur through those channels.”

That Binance is being targeted by the Biden administration, despite being completely legal but not registered in the U.S., should not come as a surprise.

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