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Major cryptocurrency exchange counters claims of transferring billions associated with Iran.
The Wall Street Journal, The New York Times, and Fortune have all reported that investigators were released after uncovering transactions that violated sanctions.
Binance’s Richard Teng accused WSJ of defamation. (Nikhilesh De/CoinDesk)
Key Points:
- Binance has alleged that The Wall Street Journal disseminated false and defamatory assertions about its termination of investigators who flagged concerns regarding funds linked to sanctioned Iranian entities.
- The firm claims that the employees in question voluntarily left and were not penalized for compliance-related issues, asserting that an internal assessment found no breaches of sanctions laws concerning the transactions in question.
- Binance asserts that suspicious activities were identified and reported, demonstrating that its controls are effective, while committing to provide a comprehensive report to the U.S. Justice Department and asserting that its exposure to sanctions is limited.
On Tuesday, crypto exchange Binance accused The Wall Street Journal of spreading “false information” in a Monday article claiming the exchange had terminated employees who were investigating funds routed to sanctioned entities.
Richard Teng, co-CEO of Binance, criticized the WSJ for “inaccurate reporting about our compliance program” in a post on X. He shared a letter from the crypto exchange’s legal counsel in New York City, which stated, “The Wall Street Journal published defamatory claims,” despite the exchange’s efforts to “set the record straight.” The letter is akin to one Binance sent to Fortune last week regarding a similar article alleging the exchange fired investigators who raised concerns about sanctions.
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The Journal’s piece on Monday stated that the crypto exchange dismissed staff investigators who uncovered $1 billion that was funneled to “a network funding Iran-backed terror groups.” The report claimed to possess Binance documents and statements from individuals familiar with the exchange’s operations, asserting that the crypto exchange dismantled the staff investigation into the $1 billion.
Binance asserts that staff were disciplined
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The Journal article includes a statement from a Binance representative indicating that the investigators resigned and denied being fired or suspended for raising compliance issues.
“Documents, foreign law-enforcement officials, and individuals knowledgeable about Binance’s operations indicated that the same actions that violated sanctions and anti-money-laundering laws have continued at the exchange,” the Journal article noted, alluding to Binance’s 2023 settlement with the U.S. Department of Justice and other authorities, in which the exchange and founder Changpeng “CZ” Zhao acknowledged breaching federal money laundering statutes.
The report also referenced an additional $1.7 billion anticipated to be transferred from Binance-registered Chinese clients to Iran-linked groups, including Yemen’s Houthi militants, in 2024 and 2025. An article by The New York Times published on February 23 alleges similar information.
Both prominent U.S. newspapers reported that the four individuals “fired” by Binance, who held roles in compliance and market oversight, were dismissed after the crypto exchange determined they had inadequately escalated red flags concerning suspicious trading activities and potential policy violations.
A Binance spokesperson informed CoinDesk that the exchange carried out an “internal review and found no evidence of violations of relevant sanctions laws or regulations regarding the transactions in question.”
Nonetheless, the spokesperson, who stated that no investigator was let go for raising compliance or potential sanctions issues, indicated that suspicious activities were identified and reported, which serves as “evidence that our controls are functioning effectively, not otherwise.”
Rachel Conlan, another spokesperson, informed the Times that an investigation is ongoing and that a comprehensive report will be submitted to the U.S. Justice Department on February 25.
Binance stated in a blog post on Sunday that its “sanctions-related exposure is minimal.”
“Recent coverage of our top-tier compliance is, at best, inaccurate. It presents a distorted, jumbled account that relies on false claims by disgruntled former employees. This incomplete and flawed perspective reflects a lack of understanding of general compliance control processes for crypto exchanges,” the blog post, issued prior to The Wall Street Journal’s report, stated.
