A recent report from The Wall Street Journal (WSJ) has alleged that Iranian financier Babak Zanjani utilized Binance to facilitate approximately $850 million in transactions over a two-year period, purportedly to fund Iran’s military activities. The transactions are said to have occurred through a single trading account that remained active until January. The WSJ report cites internal Binance compliance findings, suggesting that Zanjani, who has described himself as an “antisanction” operator, managed this network. The report further indicates that Zanjani’s associates, including family members and a company director, operated additional accounts linked to the same devices, a pattern that Binance’s investigators had reportedly flagged.
Key Takeaways
- The Wall Street Journal reported allegations of a secret payment network run by Iranian financier Babak Zanjani, involving $850 million in transactions on Binance.
- These transactions are alleged to have funded Iran’s military and were reportedly processed through a single Binance account.
- Binance CEO Richard Teng has disputed the report, calling it “fundamentally inaccurate” and stating that the transactions predated sanctions on the individuals involved.
- A Binance spokesperson emphasized the exchange’s zero tolerance for illicit activity and stated they did not permit transactions with sanctioned individuals.
- The report emerges while Binance is involved in an active defamation lawsuit against the WSJ regarding similar previous allegations.
- U.S. authorities, including the DOJ and Treasury, are also investigating Binance’s alleged role in helping Iran evade sanctions.
Binance CEO Richard Teng has publicly refuted the WSJ’s claims on the social media platform X, characterizing the reporting as “fundamentally inaccurate.” Teng asserted that the transactions cited by the WSJ occurred prior to the individuals involved being placed on sanction lists. He further stated that Binance had proactively investigated the activity before being contacted by the WSJ and had provided the newspaper with these factual details before publication.
A spokesperson for Binance further elaborated to The Block, asserting that the exchange “did not permit any transactions with sanctioned individuals.” The spokesperson argued that the WSJ’s report “materially overstates Binance’s role” by conflating broader blockchain activity with direct platform flows, such as deposits, withdrawals, and trading. The exchange maintains a strong stance against illicit activities, with Teng reiterating, “Binance has zero tolerance for illicit activity.”
This latest report surfaces amidst ongoing legal scrutiny for Binance. The exchange is currently engaged in a defamation lawsuit against The Wall Street Journal, initiated in March, over previous reporting on similar allegations concerning Iran-linked financial flows and the dismissal of internal compliance investigators. The lawsuit contends that the WSJ’s February reporting was false.
Furthermore, the U.S. Department of Justice (DOJ) has been investigating whether Binance has been used to facilitate Iran’s evasion of U.S. sanctions. In May, the U.S. Treasury Department reportedly issued a private directive to Binance, demanding adherence to an independent compliance monitoring program, a requirement stemming from Binance’s 2023 guilty plea. This directive was reportedly prompted by new reports indicating that over $1 billion had allegedly moved through the exchange to Iran-linked entities in 2024 and 2025.
Potential Regulatory Precedent
The ongoing investigations and reports surrounding Binance’s alleged dealings with Iran-linked entities, coupled with the exchange’s disputes over journalistic reporting, highlight critical challenges in global cryptocurrency regulation and enforcement. If substantiated, the alleged facilitation of transactions that circumvent sanctions would represent a significant breach of international financial regulations. This situation could prompt stricter regulatory oversight from bodies like the Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC) in the United States, potentially leading to more stringent Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements for global exchanges. The case may also influence the development of international frameworks, such as the European Union’s Markets in Crypto-Assets (MiCA) regulation, by underscoring the need for robust cross-border cooperation and enforcement mechanisms to prevent the use of digital assets for illicit purposes and the evasion of sanctions. The legal stakes are substantial, potentially impacting Binance’s operational licenses in various jurisdictions and setting a precedent for how regulatory bodies pursue and penalize exchanges found to be non-compliant with sanctions regimes.
Source: : www.theblock.co