Binance’s Compliance Requirements Revealed in Court Documents
New information has come to light regarding Binance’s compliance obligations following its plea deal with the U.S. government, according to recently unsealed court documents.
A Strong Emphasis on Compliance
According to the court documents, Binance will be required to conduct regular risk-based reviews, internal investigations, and implement measures to prevent circumvention of regulations. They must also establish a clear corporate policy against violations of U.S. sanctions and anti-money laundering laws.
Additionally, Binance must provide training and guidance to ensure that all employees comply with these requirements.
Binance has also agreed to retain an independent compliance monitor for at least three years. This monitor will assess the company’s compliance programs, policies, and internal controls.
FinCEN Oversight
Aside from the Department of Justice (DOJ) monitorships, Binance will also face five years of oversight from the Financial Crimes Enforcement Network (FinCEN).
This level of oversight is unprecedented and places Binance under significant scrutiny.
The Road Ahead
As part of their plea deal, Binance will pay $4.3 billion in penalties and exit the U.S. market entirely.
Richard Teng, who has taken over as CEO, expressed his willingness to engage with policymakers and work towards the long-term sustainability of crypto.
However, these stringent requirements may pose challenges for Binance as they open up opportunities for law enforcement and regulatory teams to gather incriminating evidence.
The founder and former CEO of Binance, Changpeng “CZ” Zhao, has pleaded guilty to federal law violations and awaits sentencing on February 23rd, 2024.
Hot Take: Binance Faces Unprecedented Compliance Demands
The recently revealed compliance requirements for Binance demonstrate the extent of oversight and scrutiny the company will face. With both DOJ and FinCEN monitorships, Binance will be under constant surveillance. These measures are more rigorous and comprehensive than any other financial firm has ever encountered. While Binance expresses a commitment to engaging with policymakers and ensuring the sustainability of crypto, the challenging obligations set forth by the government could pose significant obstacles. The plea deal’s penalties and the forthcoming sentencing of its founder further add to Binance’s uncertain future. The crypto giant must navigate these unprecedented compliance demands to regain stability and trust in the industry.
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