Binance, the world’s leading cryptocurrency exchange, is facing further legal troubles as reports suggest that its French arm has been under investigation since early 2022.
According to an article in the French daily, Le Monde, the Judicial Investigation Service of Finance has been conducting a preliminary investigation into Binance in France since February 2022.
The investigation is said to be focused on alleged “aggravated money laundering” and the illegal provision of services to French customers.
The Paris Prosecutor’s Office cited acts of illegal exercise of the function of a service provider on digital assets and participation in investment operations, concealment, and conversion as the basis for the investigation.
Binance is accused of failing to comply with Know Your Customer procedures, which are designed to prevent money laundering activities.
In addition, it has been revealed that Binance operated in France without obtaining the necessary operating license.
Since 2019, crypto exchanges have been required to obtain approval from the Financial Markets Authority (AMF) in order to operate in France.
However, Binance reportedly only received AMF approval in May 2022, despite operating in the country since 2020.
A spokesperson for Binance emphasized that the company cooperates with law enforcement globally and complies with all laws in France. They stated that user information is securely held and provided to government officials only with documented and appropriate justification.
The investigation in France comes shortly after Binance’s subsidiary in the United States, Binance.US, and CEO Changpeng Zhao were hit with 13 charges by the U.S. Securities and Exchange Commission.
These charges further contribute to the legal challenges faced by the global cryptocurrency exchange.
As the investigation unfolds in France, Binance’s compliance with regulatory requirements and its handling of user data will be closely scrutinized.
The outcome of the investigation could have significant implications for Binance’s operations in France and its global reputation.
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