2023-06-16 06:19:11
The French branch of Binance, the world’s leading cryptocurrency exchange, is under preliminary investigation in France, conducted by the judicial investigation service of finance under the direction of the specialized interregional jurisdiction of Paris , since February 2022. Information confirmed at Monde by the Paris prosecutor’s office, which specifies that the investigation “deals on the one hand with acts of illegal exercise of the function of service provider on digital assets (PSAN), and on the other hand with acts of aggravated money laundering, by competition with investment operations, concealment, conversion, the latter being carried out by perpetrators of offenses having generated profits”.
The platform is suspected of having failed in its obligations in terms of so-called procedures « know your customer » (“know your customers”, KYC), which include all the checks that financial services must operate to prevent their platforms from being used for money laundering.
These suspicions of “aggravated money laundering” join some of the reproaches made by the American stock exchange authority, the SEC, to Binance, in a proceedings brought once morest the cryptoasset specialist on June 5. The company is accused of having offered its services to American customers illegally. The SEC notes in the publicly available charging documents that “Until August 2021, Binance didn’t even require all of its customers to complete KYC documents.” The US regulator claims that at that time only 25 million of Binance’s 62 million users worldwide had completed these documents, and that “Binance had at least until mid-2022 a large amount of customers who did not have [rempli ces documents] ».
Canvassing outside the legal framework
The company is also suspected of a breach of French law governing crypto-asset platforms, which since 2019 has made a large number of activities conditional on obtaining the status of “digital asset service provider”. Issued by the Financial Markets Authority (AMF), this approval is essential in particular to be able to canvass potential French customers. However, Binance, which has been offering its services in France since 2020, is suspected of having bought advertisements to promote its activity in the country before being duly registered with the AMF in May 2022.
“In France, inspection visits by regulators and inspectors are part of the legal obligations to which all financial institutions are subject”details a spokesperson for Binance at Monde. “We hosted a visit to our premises from the competent authorities last week. As always in this case Binance has fully cooperated. » A reference to a search carried out in their premises which made it possible to collect documentary and computer elements which are now the subject of an in-depth study by the French justice. The company assures that it “respects all laws in France as in all countries” where she operates, and explains that she cannot “comment in detail on investigations by regulators or forces of the other”more than “the information of its customers is stored in a secure manner and is only provided to the authorities within the framework of a [demande légale justifiée] ».
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