Binance responded to a letter from United States senators in early March requesting information about the country’s cryptocurrency operations, including its balance sheet.
According to to the March 18 message, Binance’s response did not include the requested financial information. Bloomberg learned from an anonymous source that although he was left out of the letter, the exchange sent the information to US regulators.
In the 14-page document, Binance Chief Strategy Officer Patrick Hillman delves into the exchange’s compliance history, acknowledging past mistakes and saying the firm has built solid Know Your Customer and Anti-Money Laundering policies over the years. But the response failed to address the senator’s concerns about Binance’s lack of transparency.
Hillman noted in the letter:
“Binance uses both in-house tools and tools from established third-party vendors to scan user transactions and profiles in real-time. […] between August 2021 and November 2022, Binance halted more than 54,000 transactions due to transaction monitoring alerts.”
On March 2, three US senators led by Elizabeth Warren sent a letter to the CEO of Binance Changpeng “CZ” Zhao and Binance.US CEO Brian Shroder, who have expressed concern about Binance’s activities and are demanding the companies’ balance sheets.
According to the Senators, there is evidence that Binance and its US affiliate attempted to evade US regulators, avoid sanctions and facilitate the laundering of at least $10 billion. “The little information about Binance’s finances that is publicly available suggests that the exchange is a hotbed of illegal financial activity,” the senators wrote in the letter.
Binance has previously stated that the two companies are separate entities with independent management and operations.
Among the senator’s demands were “all balance sheets of Binance and Binance subsidiaries from 2017 to the present,” as well as anti-money laundering policies and similar policies and documents on the relationship between Binance and Binance.US.
US Securities and Exchange Commission (SEC) launched the probe in February to Binance.US regarding trading firms allegedly connected to Binance CEO Changpeng Zhao. Investigative report hinted that Binance was behind the transfer of roughly $400 million in funds from a Binance.US account to a trading firm run by CEO Changpeng Zhao.