A new investigative report has cast a shadow over Binance’s compliance efforts, alleging that the world’s largest cryptocurrency exchange allowed 13 suspicious accounts to process over $1.7 billion in transactions between 2021 and 2025.
Most notably, the report from the Financial Times claims that approximately $144 million of this volume moved after Binance’s historic November 2023 settlement with U.S. authorities – a deal that was supposed to mark a “new chapter” for the exchange’s regulatory transparency.
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Red Flags: Terror Links and ‘Impossible’ Travels
The leaked internal data highlights several high-risk profiles that allegedly remained active despite clear red flags:
Terror Financing Links: 13 accounts reportedly received $29 million in USDT from wallets previously frozen by Israel’s National Bureau for Counter Terror Financing (NBCTF). Some of these funds are tied to networks accused of moving money for Hezbollah and the Houthis.
Physically Impossible Activity: One specific account showed a login from Caracas, Venezuela, only to be accessed from Osaka, Japan, less than 10 hours later – a travel feat impossible by commercial flight, yet one that failed to trigger an immediate permanent freeze.
The Venezuelan ‘Money Transmitter’: An account belonging to a 25-year-old in a Venezuelan slum allegedly moved $93 million. The account reportedly changed bank details 647 times in just 14 months, a hallmark of unlicensed money-transmitting businesses.
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The Monitoring Gap
The allegations come at a sensitive time for Binance. Since May 2024, the exchange has been under the watch of two independent monitors appointed by the U.S. Justice Department and the Treasury.
This monitoring follows a 2023 plea deal to implement real-time monitoring, enhanced due diligence and regular custome reviews to detect suspicious activities.
At the time of the historic $4.3 billion plea deal, U.S. federal authorities laid out a staggering list of compliance failures. Specifically, the Department of the Treasury and FinCEN alleged that Binance willfully bypassed reporting requirements for over 100,000 suspicious transactions.
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These transactions weren’t merely administrative errors; they were linked to some of the most severe categories of global financial crime:
Terrorist Financing: Transfers involving sanctioned groups such as al-Qaeda, ISIS, Hamas, and the Palestinian Islamic Jihad.
Cybercrime & Ransomware: Proceeds from dozens of high-profile ransomware strains that bypassed basic AML (Anti-Money Laundering) filters.
Heinous Crimes: Settlements involving narcotics trafficking and websites dedicated to the distribution of child sexual abuse material.
The core of the government’s argument was that Binance’s “growth at any cost” strategy allowed illicit actors to move funds freely, posing a direct threat to the integrity of the international financial system.
While Binance maintains it has a “zero-tolerance approach” to illicit activity and has significantly boosted its compliance spending, the report suggests that “bad actors” are still finding gaps in the system.
For African users and local exchanges, this development reinforces the growing pressure from regulators like SEC Nigeria and FSCA South Africa for platforms to implement rigorous, real-time “Travel Rule” compliance and AML monitoring.
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