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Binance is under the spotlight again after three US senators wrote a letter to the world’s leading crypto exchange requesting details of its anti-money laundering guidelines. As the Wall Street Journal (WSJ) revealed, the Lawmakers labeled Binance a “hotbed of illegal financial activity” and sought clarity over its operations.

Binance Faces Another Scrutiny

Based on the letter to the exchange’s CEO Changpeng Zhao (CZ) dated Wednesday, March 1, the lawmakers ask for details of Binance’s balance sheets, its internal operating procedures, and other memos about CZ to stop compliance. The letter, signed by Sen. Elizabeth Warren, Chris Van Hollen, and Roger Marshall, alleges that Binance and its subsidiaries have purposefully avoided interacting with regulators.

WSJ reported that there were allegations that the exchange was facilitating digital assets transfers to criminals and other sanctioned entities and hiding financial information from customers and the general public. Meanwhile, a spokesperson for the exchange revealed that Binance always responds to official queries from every jurisdiction where it operates.

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But the spokesperson emphasized that the three US senators’ allegations in the letter purportedly written are invalid. The spokesperson added that there is a lot of misinformation about Binance making the rounds, and the exchange is looking to correct it.

Additionally, the Binance spokesperson noted that has no corporate presence in the United States or customers in the country. However, the firm conduct business in the US through its subsidiary company, Binance.US.

According to the exchange’s spokesperson, Binance will duly respond to the senators’ allegations and make them understand why it is the most trusted and widely used crypto trading platform globally.

Will Binance Be Fined For Past Violations?

According to a recent publication by the WSJ, US regulators are sniffing around the largest crypto exchange following a series of regulatory violations allegedly committed by Binance. The report indicated that Binance has revealed that it is willing to pay the monetary fines to make amends for violating the law.

Last month, the WSJ claimed that Patrick Hillman, Binance’s chief strategy officer, disclosed that the exchange recorded a rapid rise. Hence, it was unaware of the numerous laws and regulations preventing money laundering, evading financial sanctions, and other illicit activities.

But it’s now taking steps to address the situation already. Following last November’s spectacular collapse of its rival, FTX, Binance has come under increasing scrutiny from financial watchdogs.

Reports indicate that the exchange has been under investigation by the US Attorney’s Office for the Western District of Washington since 2018. Similarly, the Department of Justice (DoJ) has reportedly issued two trading firms associated with Binance.US subpoenas, requesting records of their past transactions.

Meanwhile, Hillman believes Binance has what it takes to amend with the regulators and will collaborate where required.

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George Ward

By George Ward

George Ward is a crypto journalist and market analyst at Herald Sheets, known for his engaging articles on the latest digital currency trends. With a background in finance and journalism, he presents complex topics accessibly. George holds a degree in Business and Finance from the University of Cambridge.