Editor’s Note
India’s Financial Intelligence Unit has fined cryptocurrency exchange Binance approximately $2.25 million for violations of anti-money laundering regulations. This enforcement action underscores the heightened regulatory scrutiny facing global crypto platforms in key markets.
The Finance Ministry has taken major action against Binance, the world’s largest cryptocurrency exchange firm. The country’s Financial Intelligence Unit (FIU) has imposed a fine of 18.82 crore rupees (2.25 million dollars) for non-compliance with rules related to money laundering. The FIU has issued a notification in this regard.
In its notification, the Financial Intelligence Unit further stated that the major cryptocurrency exchange firm Binance must pay the fine of 18.82 crore rupees. Additionally, Binance has been directed to “ensure compliance with Chapter IV of the PMLA 2002.” Furthermore, to curb money laundering activities and prevent the funding of terrorism, it must maintain records of all transactions in accordance with the PMLA Record Rules 2005.
Action has been taken against Binance for non-compliance with money laundering-related rules. In fact, Virtual Digital Asset Service Providers (VDA SPs) like crypto exchanges are required to register with the FIU as a Reporting Entity, and it is mandatory for them to comply with its anti-money laundering rules. Binance completed its registration with the FIU last month in May. It is worth noting that earlier this year, the financial intelligence unit had blocked 9 offshore exchanges. The financial regulator had blocked these exchanges for not being registered and for not complying with local money laundering rules under the PMLA 2002 Act. During this period, the regulator had also imposed a fine of 34.5 lakh rupees on KuCoin.
India is not the first country to take action against Binance. Prior to this, the Canadian government had imposed a fine on Binance. Last month in May, Canada’s anti-money laundering agency imposed a fine of 4.38 million dollars for allegedly violating anti-money laundering rules. Additionally, a US District Judge had sentenced Binance’s CEO Changpeng Zhao to 4 months in prison.