Financial Intelligence Unit imposes Rs 18.82 Cr penalty on Binance

The Financial Intelligence Unit (FIU) has imposed a fine of  Rs 18.82 crore (equivalent to $2.25 million) on Binance, the world’s largest cryptocurrency exchange, for violations of anti-money laundering regulations.

The penalty was imposed a month after the FIU approved Binance’s registration in India. Reportedly, the money laundering watchdog issued show-cause notices to nine offshore exchanges for violating the regulations.

Binance was issued notices in December 2023 for providing services to Indian clients and running operations in India without adhering to the statutory obligations under the under Section 13 of the PMLA act, according to the FIU’s press release.

Along with Binance, the crypto exchange platform KuCoin also received approval from the FIU in May this year subject to penalty after the hearing with the regulator. KuCoin was also penalized with Rs 34.5 lakhs.

Binance faced a $4.4 million penalty by Canada’s financial watchdog for violating the money laundering and terrorist financing laws in May.

“This significant penalty is a clear indication of the increasing scrutiny and regulation in the digital asset space. I believe that the regulations are getting more organized for cryptocurrency exchanges. Sustained efforts by FIU-IND will lead to a fertile ground for Web3 businesses to grow and enable India to become a $1 trillion digital economy,” Shivam Thakral, CEO of BuyUcoin, said in a statement.