Binance Slapped with $2.3M Fine by India’s Financial Watchdog for AML Violations

Key Takeaways

• Binance was fined and briefly banned in India for violating anti-money laundering laws.
• The exchange faced global regulatory challenges, including fines, legal battles, and executive arrests.
• Binance.US, the American branch of Binance, recently lost licenses in seven states and halted new user onboarding due to compliance issues.

India’s Financial Intelligence Unit (FIU) has imposed a fine of 188.2 million rupees (approximately $2.26 million) on Binance, the world’s largest cryptocurrency exchange by volume, for breaching the nation’s anti-money laundering laws.

It is still uncertain when Binance will recommence its operations in India.

Last December, the Indian Financial Intelligence Unit (FIU) blocked access to Binance and eight other foreign cryptocurrency exchanges operating in India. The order also compelled Apple and Google to remove these crypto exchanges from their app stores for local users.

In India, cryptocurrency exchanges are required to register  with the FIU as reporting entities and comply with local anti-money laundering regulations. Additionally, there are mandates to withhold taxes on cryptocurrency transactions and profits.

Seychelles-based KuCoin, one of the blacklisted exchanges, quickly adhered  to Indian regulations by complying within a month and paying a penalty of 3.45 million rupees. While Binance has not made any official statements, reports indicate that the exchange is looking to resume operations in India by settling the penalty.

Binance completed its registration with the FIU  last May, a step that will enable it to restart its services in India.

The FIU announcement  stated that after reviewing the written and oral submissions from Binance’s director, the FIU-IND determined that the evidence on record substantiated the charges against Binance.

The fine imposed on Binance by the FIU-IND cites several violations, including the failure to maintain and report transaction records, the non-provision of necessary information to authorities, and the failure to preserve records as required by law.

About the Author

Teuta Franjkovic

Teuta is a seasoned writer and editor with more than 15 years of experience. She has expertise in covering macroeconomics and technology as well as the cryptocurrency and blockchain industries. She has worked for several publications as a journalist and editor, including Forbes, Bloomberg, CoinTelegraph, Coin Rivet, CoinSpeaker, VRWorld and Arcane Bear. Teuta began her professional career in 2005, working as a lifestyle writer at Cosmopolitan in Croatia. From there, she branched out to several other publications, covering mainly business and the economy. She then turned her attention to the world of cryptocurrency and blockchain, believing that crypto is among the most important inventions in the history of humanity. Her involvement in fintech began in 2014 and she has since lent her expertise in writing, editing and gathering information about the world of crypto, blockchain, NFTs and Web3. An all-round news hound, mentor, editor, and writer, Teuta enjoys teamwork and good communication. She holds a WSET2 diploma and has a thing for chablis, punkrock music and shoes. She also holds a double MA in Political science and Entrepreneurship.

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