Finance responded to a letter sent by US senators in early March requesting information on cryptocurrency trading activities in the country, including its balance sheet.
Accordingly With a March 18 statement, Binance’s response did not include the requested financial data. Bloomberg learned from an anonymous source that although the letter was omitted, the exchange passed the information on to US regulators.
In a 14-page document, Binance Chief Strategy Officer Patrick Hillman dives into the exchange’s compliance record, admits to past mistakes, and says the company has built solid know-your-customer and anti-money laundering policies over the past few years. However, the response did not address the senator’s concerns about the lack of transparency of finances.
Hillman noted in the letter:
“Binance uses internal tools and tools from established third-party vendors to verify transactions and user profiles in real-time. […] Between August 2021 and November 2022, Binance suspended 54,000 transactions as a result of transaction monitoring alerts.”
On March 2, three US senators led by Elizabeth Warren sent a letter to Binance CEO Changpeng “CZ” Zhao and Binance.US CEO Brian Shroder, raising concerns about Binance’s actions and requesting the companies’ balance sheets.
According to the senators, there is evidence that Binance and its US arm attempted to evade US regulators, avoid sanctions and launder at least $10 billion. “The little information publicly available about Binance’s finances suggests that the exchange is a hotbed of illicit financial activity,” the senators wrote in the letter.
Binance previously stated that the two entities are separate entities with independent management and operations.
The senator’s demands include “all balance sheets of Binance and Binance affiliates from 2017 to present,” as well as policies and documents related to anti-money laundering and the relationship between Binance and Binance.US.
The US Securities and Exchange Commission (SEC) opened an investigation into Binance.US in February regarding businesses allegedly associated with Binance CEO Changpeng Zhao. An investigative report suggested Binance was behind the transfer of roughly $400 million in funds from a Binance.US account to a trading firm run by CEO Changpeng Zhao.
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