Binance Faces Investigation in France

According to a recent report, the leading cryptocurrency exchange in the world, Binance, has been under investigation in France since the beginning of 2022.

Since February 2022, according to a report published in the French newspaper Le Monde, the France-based branch of the cryptocurrency exchange has been the subject of a preliminary investigation by the Judicial Investigation Service of Finance under the direction of the specialized interregional jurisdiction of Paris.

The Paris Prosecutor’s Office reportedly cited “acts of illegal exercise of the function of a service provider on digital assets (PSAN)” and “acts of aggravated money laundering by participating in investment operations, concealment, and conversion, the latter being carried out by profit-making offenders” as the investigation’s basis.

According to reports, Binance did not observe or comply with Know Your Customer procedures that monitor users and potential money laundering.

The cryptocurrency exchange allegedly failed to acquire an operating license and offered its services illegally to French clients.

Since 2019, crypto exchanges must obtain approval from the Financial Markets Authority (AMF) to operate.

However, Binance, which has been functioning in France since 2020, reportedly only received AMF approval in May 2022, despite being operational in France since 2020.

A Binance spokesperson said:

“Binance invests considerable time and resources into cooperating with law enforcement globally. We abide by all laws in France, just as we do in every other market we operate. We will not comment on the specifics of law enforcement or regulatory investigations except to say that information about our users is held securely and only provided to government officials upon receipt of documented appropriate justification.”

Reports of the investigation in France surfaced within weeks of the filing of a lawsuit against the cryptocurrency exchange in the U.S.

The U.S. Securities and Exchange Commission has filed thirteen allegations against the U.S. subsidiary of the cryptocurrency exchange, Binance.US, and its CEO, Changpeng Zhao.