Crypto-currency exchange Binance has been at the center of controversy in recent weeks, and here’s one more. On Thursday, February 16, a Reuters article notes that Binance had secret access to its U.S.-based partner’s bank account and allegedly transferred $400 million from that account to a trading company run by Changpeng Zhao.
Explaining the trail of the funds transfers, Reuters noted that they went from Binance.US’s account at Silvergate Bank to the trading company Merit Peak Ltd. Moreover, all of these fund transfers took place in the first three months of 2021. Citing all bank documents and company messages, Reuters said the transfer of funds actually began in late 2020.
The publication noted that it could not determine whether the transferred funds belonged to U.S. customers. In addition, it noted that they had no idea why the funds were moved. But Reuters added that Binance.US executives expressed concern about the transfers because they did not know why they were taking place.
In response to the Reuters report, Kimberly Soward, a spokeswoman for Binance.US, said the publication reported “outdated information“. However, he did not answer questions about the transfers.
Binance and SEC Regulations
Recently, the U.S. Securities and Exchange Commission (SEC) expanded its oversight of crypto-currency exchange Binance. Earlier this week, reports emerged that the SEC may see BUSD issuer Paxos about selling BUSD as unregistered securities.
Top executive says Binance may be willing to pay penalties to settle investigations into its U.S. operations Binance Chief Strategy Officer Patrick Hillmann recently admitted that the company’s executives were unaware of the rules and laws regarding bribery and money laundering.
Binance “is working with regulators to determine what corrective action we need to take now to make amends” he said.
The U.S. Department of Justice (DoJ) has been investigating Binance for a long time now, since 2018, for violations of U.S. sanctions and anti-money laundering rules.
Now, Binance finds itself in another major allegation about the crypto firm. However, they have flatly denied the allegations by Reuters.