India’s FIU has handed down a fine of $2.25 million to Binance, the world’s largest cryptocurrency exchange, due to its failure to comply with local anti-money laundering regulations. This marks the highest fine ever imposed on a crypto entity for non-compliance with AML laws in India.
Under Indian regulations, virtual digital asset service providers, including crypto exchanges, are required to register with the FIU as reporting entities and adhere to its AML rules. Binance’s failure to meet these requirements resulted in the significant penalty. The exchange has not yet provided a comment on the fine.
In order to resume operations in India, Binance registered with the FIU in May after receiving show-cause notices from the watchdog. These notices were issued to nine offshore exchanges that were found to be operating in violation of local regulations. As part of its crackdown, the FIU also recommended that the Ministry of Electronics and Information Technology block online access to these exchanges.
This is not the first instance of a cryptocurrency exchange facing penalties for AML violations in India. In March, KuCoin, another major crypto exchange, registered with the FIU and was fined a smaller amount of $3.45 million for similar infractions.
Binance has faced regulatory scrutiny on a global scale. In May, Canada’s anti-money laundering agency imposed a hefty fine of $4.38 million on the exchange for breaches of AML regulations. Furthermore, Binance’s former CEO, Changpeng Zhao, was sentenced to four months in prison by U.S. District Judge Richard Jones in Seattle after pleading guilty to violating American AML laws.
