Key Highlights
- The inquiry seeks to determine whether Binance reacted appropriately to the concerns raised by its own compliance personnel.
- The senator asked Binance executives to provide records related to transactions flagged as violating sanctions and internal investigations.
Richard Blumenthal, a U.S. senator from Connecticut, has launched a formal inquiry seeking information about Binance’s internal compliance practices. This comes after allegations that the cryptocurrency exchange processed transactions for sanctioned entities and its response to internal warnings about possible prohibited activity.
The probe comes after a report claiming the exchange processed a large number of transactions associated with sanctioned Iranian parties and shipping networks tied to Russia.
Senator requests internal records
According to an official announcement, the senator asked for records from Binance executives, including materials related to:
- Transactions flagged as potentially violating sanctions
- Internal investigations and compliance reviews
- Actions taken after suspicious activity was identified
The inquiry aims to determine whether the company responded appropriately to concerns raised by its own compliance personnel.
Allegations of sanctioned transactions
According to reporting cited by the Senate inquiry, Binance allegedly processed roughly $1.7 billion in transactions connected to sanctioned Iranian entities and vessels associated with Russia’s so-called shadow fleet.
The report relied on internal records and unnamed sources who claimed that compliance staff identified potentially restricted transactions. Some employees involved in the review of the activity were reportedly dismissed.
Binance disputes findings
Binance has rejected claims that it violated sanctions requirements and said internal reviews found no evidence of wrongdoing. The company stated that its compliance systems have been strengthened in recent years and pointed to declining levels of sanctions-related trading activity on the platform.
According to Binance, the share of trading activity linked to sanctions concerns has fallen sharply since 2024 and now represents a small fraction of total volume.
What the probe means
The investigation adds to ongoing regulatory pressure on the major cryptocurrency exchanges operating worldwide. It is expected to evaluate whether Binance’s controls were sufficient to detect and prevent transactions involving sanctioned entities.
Also Read: Binance Says Sanctions Risk Dropped 97% After Compliance Reforms
