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Binance Nigeria: What Could High Court Data Demand Dredge Up?

Published March 18, 2024 3:26 PM
Eddie Mitchell
Published March 18, 2024 3:26 PM
By Eddie Mitchell
Verified by Peter Henn
Key Takeaways
  • Nigerian authorities are seeking a comprehensive list of all Nigerian Binance users.
  • Binance Nigeria processed over $21 billion in trading volumes in 2023.
  • Authorities are seeking to extend the detainment of two Binance executives held since late February 2024.

A Nigerian High Court has ordered Binance to provide the data of all its Nigerian users. Meanwhile, authorities continue to probe the exchange for alleged money laundering, and terrorism financing through the platform.

Investigators are eager to scrape through the data with a fine toothcomb. Indeed, they may perhaps find the ‘smoking gun’ that justifies their recent investigations into Binance’s operations in Nigeria.

Binance Nigeria User Data Demanded

According to Nigerian media , a Federal High Court in Abuja has ordered Binance to provide all Nigerian user data. Not only that, but it also wants Binance to submit the data to the Nigerian Economic and Financial Crimes Commission (EFCC).

The interim order now enables the nation’s anti-graft agency to delve deeper into allegations of terrorism financing and money laundering. The order  says:

“That an order of this honourable court is hereby made directing the operators of Binance to provide the commission with comprehensive data/information relating to all persons from Nigeria trading on its platform,”

Hamma Bello, an EFCC operative within the Special Investigation Team (SIT) noted that SIT “received an intelligence” following the inauguration of the Technical Committee on Currency Stability and Forex Manipulation by the Office of the National Security Advisor (NSA).

Bello said: “The information afforded to the team by Binance shows that the total trading volume from Nigeria in 2023 alone stood at $21.6 billion.”

This seems to fit with the government’s narrative that Binance processed $26 billion in illicit and unknown funds through Binance Nigeria. Now, however, it seems like the government needs a more comprehensive user breakdown if it wants to make any real conclusions.

Market Manipulation Allegations

Bello also noted the claims of Binance Nigeria manipulating markets and weakening the Naira are not unfounded. He said:

“The team uncovered users who have been using the platform for price discovery, confirmation and market manipulation which has caused tremendous distortions in the market, resulting in the Naira losing its values against other currencies.”

Following complaints from the Nigerian government that Binance was capping Naira/USDT exchange rates, Binance discontinued all Nigerian Naira spot trading pairs earlier in March 2024.

Though these investigations may not conclude anytime soon, the situation for Binance is considerably dire. This is especially true for the two Binance executives who have been detained since arriving in Nigeria just some weeks ago.

‘Indefinite’ Detention for Binance Executives

Binance executives Tigran Gambaryan and Nadeem Anjarwalla have been stuck in Nigeria after Nigerian authorities seized their passports in February.

Since their detainment, reports  have noted the FDCC wants to authorize their detention’s extension while investigations are ongoing. This is despite having no official charges levied against them.

Binance says it has been working with Nigerian authorities and officials in several initiatives, to foster better relations.

Yet despite Binance’s claim  these collaborations were well-met and “received overwhelmingly positive feedback from Nigerian investigators, who expressed strong interest in continuing this format of cooperation,” relations appear far from friendly.

No Way Back for Binance?

As it stands, Binance is in incredibly hot water in Nigeria. However, it still stands to reason that these investigations are not yet over.

Given the heightened nature of Nigeria’s investigation into Binance and the ethically dubious detainment of two – seemingly innocent – Binance employees, that Nigerian authorities have a strong case against the exchange, or at least the two detained executives.

Should investigators find the evidence they need to confirm Binance’s role in funneling billions in illegal, illicit, or terrorist-linked funds, it could spell disaster for Binance. The impact could be global, because Binance has already pleaded guilty to such charges in the United States.

EFCC operator Bello noted that this was an urgent public matter and that “the commission will ensure that investigation is conducted within such reasonable time.”

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