- U.S. officials probe alleged Iran-linked transactions on Binance as the exchange denies claims and sues WSJ.
- Reports of a halted $1B probe spark scrutiny of Binance’s compliance and sanctions monitoring.
- Fresh inquiry adds pressure after Binance’s $4.3B settlement over anti-money-laundering violations.
Regulators in the United States have launched fresh scrutiny of Binance after new claims about Iranian-linked transactions surfaced. On Wednesday, The Wall Street Journal reported that U.S. authorities began examining whether Iran used the exchange to bypass sanctions.
The inquiry centers on transactions tied to networks allegedly supporting Iran-backed militant groups. Consequently, the report triggered immediate backlash from Binance leadership. The exchange rejected the allegations and filed a defamation lawsuit against the Journal the same day.
Meanwhile, officials linked to the United States Department of Justice have contacted individuals with connections to the transactions. The investigators are looking to uncover evidence regarding the flow of the funds as they allegedly passed through the system. The authorities, however, have not made it clear whether they are investigating Binance as a whole or just users.
Media Reports Trigger Legal Pushback
The controversy grew after the Journal published earlier findings about internal activity at the exchange. In late February, the paper claimed Binance halted an internal investigation into more than $1 billion in suspicious transactions.
According to the report, the network allegedly funded groups connected to Iran. Moreover, the Journal claimed Binance dismissed employees who examined those transfers. The report also stated that the network remained active afterward.
Additionally, The New York Times repeated similar allegations in its coverage. Consequently, the issue attracted attention from policymakers and regulators across Washington.
Binance strongly disputed those claims and defended its compliance processes. A company spokesperson rejected the reporting in a written statement. The spokesperson said, “Binance categorically did not dismantle any compliance investigation.
The WSJ continues to report the same falsities.” The statement added: “The truth is that Binance’s investigation continued and uncovered a sophisticated, multi-jurisdictional pattern of financial activity spanning Asia, the Middle East, and beyond.” The company also said investigators mapped the activity and removed the relevant accounts.
Political and Legal Pressure Intensifies
Political pressure has also increased around the case. Senator Richard Blumenthal opened a separate inquiry into possible sanctions violations tied to Binance operations. Besides that move, federal officials reportedly contacted sources with knowledge of Iranian transactions to gather additional evidence.
However, it is essential to understand that all of this is happening in the backdrop of Binance’s previous legal settlement with the US authorities. In 2023, the exchange and its former CEO Changpeng Zhao were accused of violating anti-money laundering and sanctions regulations by US regulators. Following this, Binance agreed to pay a fine of $4.3 billion and impose “stringent compliance controls.”
Moreover, the settlement forced the company to monitor users and rescreen accounts against sanctions lists. The agreement also required an independent monitor for five years. Additionally, Zhao resigned from his leadership role and later served a prison sentence. Later, former U.S. president Donald Trump granted Zhao a pardon in October.
