Richard Blumenthal, the senior Democratic senator from Connecticut, is investigating Binance, the largest crypto exchange by trading volume, over allegations that it enabled Iranian money laundering schemes and sanctions evasion linked to Russian oil trade.
In a letter sent Tuesday to Binance CEO Richard Teng, Blumenthal pointed to reports from the Wall Street Journal, the New York Times, and Fortune that Binance partners Hexa Whale and Blessed Trust allegedly acted as intermediaries for illicit transactions tied to Iranian government entities, terrorist groups including the Houthis, and Russia’s shadow oil fleet.
Reports indicated that the exchange maintained 2,000 Iranian-linked accounts and allowed nearly $2 billion in transfers despite internal warnings, while suspending or firing compliance staff who raised concerns.
Blumenthal also questioned Binance’s compliance following its 2023 guilty plea alongside founder Changpeng Zhao, and its relationship with World Liberty Financial and envoy Steve Witkoff, suggesting political ties may have contributed to regulatory relief, including lawsuit dismissal and Zhao’s pardon.
Blumenthal requested records from Binance regarding the suspected transactions and documents related to the use of crypto assets such as Tether and USD1 in money laundering or terrorist financing.
He also sought records explaining the dismissal of compliance staff who had identified potential violations.
The senator set a March 6 deadline for the exchange to produce the requested records.
The probe adds to the exchange’s ongoing regulatory challenges. In 2023, the company entered a guilty plea for processing more than $1 billion in transfers to sanctioned entities, paying $4.3 billion in penalties and accepting an independent compliance monitor.
Zhao, the exchange’s former chief executive, stepped down following those legal troubles. He received a presidential pardon from Donald Trump last October after completing a prison sentence.
The exchange has disputed the latest allegations, stating its exposure to Iran-linked activity has fallen by nearly 97% since January 2024 and denying that staff were terminated over compliance matters.
Source: https://cryptobriefing.com/binance-iran-probe/
