The global cryptoexchange Binance is facing questions over its potential role in the funding of terrorist organisation Hamas, which last week launched an attack on Israel that has so far claimed at least 900 Israeli lives.
Earlier this year, the Commodity Futures Trading Commission (CFTC) filed a civil enforcement action in Chicago against Binance, accusing the cryptoexchange of numerous violations of its regulations and of the Commodity Exchange Act. The CFTC claims Binance knew that Hamas terrorists were using the platform to launder money but that they turned a blind eye.
According to the CFTC, Binance’s former Head of Compliance, Samuel Lim, received information in February 2019 “regarding Hamas transactions” but told a colleague that the terrorists were sending “small sums” and that only “large sums constitute money laundering.” The colleague jokingly replied that “[one] can barely buy an AK47 with 600 bucks.”
In another conversation, Lim said that he was aware that some Binance customers were using the platform for illicit purposes. “Like come on. They are here for crime,” he said.
Last year, Binance was also accused of helping Iranian firms trade $8 billion worth of funds, despite the country being subject to stringent sanctions. The US Justice Department is currently investigating Binance for possible criminal sanctions violations in connection with Iran. Part of the reason for the imposition of sanctions on Iran is its funding of terrorist organisations in the Middle East, including Hamas.
In 2021, the US State Department said that Hamas receives funding, weapons, and training from Iran. The Wall Street Journal has reported that Iran helped plot Hamas’ attack on Israel over several weeks, although the Israeli military has said there is not yet any clear evidence of collusion.
Allegations that Binance facilitated the funding of Hamas and Iran-linked groups is likely to increase scrutiny on the cryptoexchange at a time it is facing more than a dozen charges initiated by the Securities and Exchange Commission (SEC).
Author: Harry Clynch