After recently settling with the U.S. Department of Justice on charges of money laundering and terrorism financing, Binance now faces scrutiny from Nigeria’s House of Representatives Committee on Financial Crimes. The committee has issued an ultimatum to Binance CEO Richard Teng, demanding his appearance before them by March 4. The allegations against Binance include involvement in financial crimes such as money laundering and terrorism financing. Committee chairman Ginger Onwusibe warned that failure to comply with the summons would lead to the invocation of constitutional powers and subsequent actions by the committee.
The Nigerian committee’s concerns stem from Binance’s alleged disregard for the country’s laws. Despite being asked to attend a hearing on multiple occasions, Binance’s Managing Director failed to cooperate, leading to the issuance of the ultimatum. Onwusibe emphasized the need to protect Nigerians from financial crimes perpetrated by foreign entities, highlighting accusations of terrorism financing, money laundering, and tax evasion leveled against Binance. The committee is determined to combat financial crime and prevent the flow of funds to illicit activities.
With Nigeria facing economic challenges, the committee is also focused on tax collection efforts. Binance, which reportedly serves over 10 million Nigerians, is accused of not paying taxes in the country and lacking a physical presence for users to address grievances. Onwusibe declared that the era of exploitation is over, signaling a push for accountability among all entities operating within the country’s borders. The Nigerian government seeks to ensure that all offenders are held responsible for their actions.
In response to the allegations against Binance, Nigeria’s telecom regulator instructed telecom companies to block access to websites of foreign crypto exchanges, including Binance, Coinbase, and Kraken. The Department of State Security recently detained two Binance executives and confiscated their passports as part of the investigation into the matter. Governor Olayemi Cardoso of the Central Bank of Nigeria expressed concerns about suspicious financial flows through Binance Nigeria, citing $26 billion passing through the platform without adequate identification of the sources and users.
Following these developments, the Nigerian government reportedly ordered Binance to pay $10 billion in compensation. Authorities believe that Binance and its executives engaged in manipulative practices related to foreign exchange rates through currency speculation and rate-fixing. The government’s actions reflect a strong stance against financial irregularities and a commitment to holding companies accountable for their actions within the country.
Binance’s troubles in Nigeria highlight the importance of regulatory compliance and accountability in the financial sector. The allegations of financial crimes, tax evasion, and manipulation have triggered a strong response from Nigerian authorities, signaling a shift towards greater oversight and enforcement. As companies like Binance continue to operate in increasingly complex regulatory environments, maintaining transparency and adherence to the law are crucial for long-term sustainability and trust among stakeholders.