India fines Binance $2.25m for operating without registration

India’s Financial Intelligence Unit (FIU) has imposed a hefty fine of $2.25 million (188.2 million rupees) on Binance, the world’s largest cryptocurrency exchange, for operating in the country without registering with the agency as required by law.

The FIU announced this penalty in a statement released on Thursday, highlighting that Binance, despite being a registered entity in India, violated three sections of the country’s Prevention of Money Laundering Act, 2002.

This development marks another setback for Binance, which is already embroiled in legal troubles in Nigeria, facing charges of money laundering and tax evasion. In Nigeria, the Economic and Financial Crimes Commission (EFCC) has accused Binance of laundering over $35 million through its platform, with a separate case of tax evasion filed by the Federal Inland Revenue Service (FIRS).

Despite registering with the FIU in May to resume operations in India after a show-cause notice in December 2023, Binance failed to comply with regulations, resulting in the significant fine.

The FIU’s statement outlined the reasons for the penalty, citing Binance’s failure to adhere to its statutory obligations under the PMLA, despite operating as a Virtual Digital Asset Service Provider (VDASP) and being considered a reporting entity.

Following the imposition of the penalty, Binance has shut down its naira-dollar services in Nigeria, amidst increased government scrutiny and a crackdown on crypto trading platforms.

In February, Nigerian authorities detained two senior Binance executives, Nadeem Anjarwalla and Tigran Gambaryan, despite the government’s ban on cryptocurrency transactions. While the Federal High Court recently dismissed tax evasion charges against the executives, the FIRS has filed amended charges, naming Binance as the sole defendant in ongoing legal proceedings.

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