News

Binance Fined $3.4 million by Dutch Central Bank For Violating Regulatory Laws

  • Richard Marley
  • July 20, 2022
  • 3 minutes read
  • 618
blog_image

The  De Nederlandsche Bank (DNB) fined Binance with $3.4 million for failing to get regulatory approval in the country

The central bank of the Netherlands, De Nederlandsche Bank (DNB) has imposed a fine of $3.4 million on the biggest crypto exchange network by trading volume, Binance, for failing to obtain regulatory approval from legal authorities to operate in the country.

The bank claims that Binance has continued to provide services in the country without completing the registration process which is required for approval. As per the bank statements, Binance was penalized in April 2022 but it objected to the penalty and showed that would appeal for.

The bank also issued a warning publicly to the Binance network in August 2021 on the other grounds of violations of laws specified for the money-laundering controls. Afterwhich DNB warned about the violations to increase the risks of user involvement in money laundering and terrorist financing.

Adding to the risks, the Dutch central bank also mentioned the crypto exchange had a competitive edge against the other firms that also own a DNB registration when it was in non-compliance. The De Nederlandsche Bank requiresVASP (Virtual Asset Service Providers) to complete its registration process in compliance with the Money Laundering and Terrorist Financing Prevention Act from May 21, 2020, maintaining that the violation made by Binance is punishable with a 3rd category charge, showing that the fine amount comes with €2 million.

The crypto trading and exchange network, Binance was charged with heavy penalties due to huge trading volumes, the DNB regulator pointed out: “Binance isn’t only the biggest provider of cryptocurrency services globally, but equally has a very large number of customers in the Netherlands with world daily trading volume reaching “$13.7 billion”.

Moreover, the fine was addded because of prolonged violations from Binance, which was initiated in May 2020 to December 2021, when DNB launched the obligation of registration. Now the verification documents of Binance are being checked by the central bank of Dutch, because of which the fine has been reduced by 5% by the Netherlands authority. The organisation has been relatively transparent about its operations throughout the process. The platform also created a local branch for the concerns called Binance Nederland BV.

Besides that Binance has approved its registration from the Bank of Spain in early July 2022 to work as VASP in the region.

Suggested Read: Dutch Money Mule Caught Involved in $3.5M of Money Laundering in Australia