Binance Fined $2.25 Million by India’s Financial Intelligence Unit

Cryptocurrency exchange Binance has been fined $2.25 million by India’s Financial Intelligence Unit (FIU) for allegedly violating the country’s Prevention of Money Laundering Act (PMLA). The penalty follows accusations that Binance provided services to Indian clients and operated within India without adhering to statutory obligations under the PMLA.

In January, Binance was one of nine cryptocurrency platforms barred by the Indian government for non-compliance with local financial regulations. Around the same time, Binance CEO and founder, Changpeng Zhao, announced his resignation after the exchange pleaded guilty to US federal charges related to anti-money laundering (AML), unlicensed money transmission, and sanctions violations.

Despite these challenges, Binance registered as a Virtual Digital Asset Service Provider (VDASP) with the FIU in May, aiming to reestablish its operations in India. However, the FIU found Binance had not met the required standards, stating that the charges against the exchange were substantiated after reviewing written and oral submissions.

The FIU has directed Binance to strengthen its AML processes, ensuring diligent compliance with the PMLA and its record-keeping requirements to prevent terrorist financing.

A Binance spokesperson said, “We are aware of the FIU’s order and are reviewing it to determine our next steps. We aim to work with the FIU as a reporting entity and are enthusiastic about reentering the Indian market to contribute positively, should we be able to do so in the near future. We remain dedicated to maintaining transparency, fostering cooperation, and ensuring compliance with regulatory authorities.”

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