The United States Department of Justice is scrutinizing Binance's compliance with the $4.3 billion settlement the cryptocurrency exchange reached with US authorities, and a newly published report has added a customer-focused angle to the review.

According to a COINOTAG update issued at 12:10 UTC on October 10, a fresh report released on October 9 introduces a named customer element: a Binance "high-value client" allegedly sat at the center of a covert payment network serving Iran's Islamic Revolutionary Guard Corps (IRGC). The account is attributed to US and Israeli authorities.

Background: the $4.3 billion settlement

The settlement under review was finalized in November 2023, when Binance agreed to pay $4.3 billion in fines and forfeiture to resolve charges that it violated US anti-money-laundering and sanctions laws, including requirements under the Bank Secrecy Act and US sanctions programs covering Iran. US officials described the resolution at the time as one of the largest corporate penalties in American history.

As part of the agreement, Binance founder and then-CEO Changpeng Zhao pleaded guilty to failing to maintain an effective anti-money-laundering program and stepped down from the company's top role; he was later sentenced to four months in prison. Richard Teng succeeded him as chief executive. Under the settlement, Binance committed to remediation measures that included enhanced compliance controls, ongoing reporting obligations, and independent monitoring over several years. Those commitments now serve as the yardstick for the Justice Department's review, since compliance with a settled case is measured against the terms the company itself accepted.

The compliance question

The Justice Department's scrutiny centers on whether Binance has adhered to the compliance obligations embedded in that resolution. The October 9 report's account of an alleged IRGC-linked covert payment network involving a high-value client adds a new element to that review, and it touches directly on the settlement's sanctions-related terms: the IRGC has been designated by the United States as a foreign terrorist organization since 2019, and transactions touching Iran are restricted under the US sanctions rules that formed part of Binance's 2023 resolution. How the allegations, attributed to US and Israeli authorities, align with the monitoring and reporting framework Binance accepted in 2023 is the question the review now poses.

This content was first published on COINOTAG: https://en.coinotag.com/doj-scrutinizes-binance-4-3-billion-settlement-compliance