According to the inquiry, the world’s largest cryptocurrency exchange sought to expand while avoiding regulatory attention.
The authors contend that there is a recurring pattern in which the company’s CEO, Changpeng Zhao, while proclaiming the company’s openness to government oversight, led an organization that routinely denied regulators’ requests for financial and corporate structure information and shirked proper client background checks.
The claimed conclusions are based on the testimony of Binance’s former senior employees and advisers, as well as an analysis of records such as internal correspondence and sensitive messages exchanged between the business and numerous national regulators. According to the document, multiple high-ranking workers raised concerns about the company’s inadequate Know Your Customer/Anti-Money Laundering (KYC/AML) requirements but were ignored by the CEO.
Furthermore, the corporation allegedly went against the advice of its own compliance department by continuing to accept new customers from seven countries deemed as having a high risk of money laundering.
The report’s authors offered the big picture takeaway that the described pattern of behavior allowed Binance to maintain ambiguous jurisdictional affiliation and an opaque corporate structure while offering financial products that would normally require regulatory approval or licensing in many of its countries of operation.
In response, a corporate spokeswoman stated that the results of the study were based on old or erroneous information. Binance CEO Changpeng Zhao later responded on Twitter, writing:
Despite ongoing investigations into suspicious activities on its platform in a number of jurisdictions, Binance continues to grow into new regions, with the most recent step related to a possible deployment in Thailand.