In light of ongoing legal issues in the United States surrounding allegations of money laundering that resulted in the resignation of its former CEO, Binance, a leading cryptocurrency exchange, is now facing fresh challenges in Australia.

AUSTRAC’s Regulatory Intervention

The Australian Transaction Reports and Analysis Centre (AUSTRAC), which acts as the country’s financial watchdog, has ordered Binance’s Australian operations to appoint an independent auditor to investigate “serious concerns” regarding its compliance with anti-money laundering (AML) and counter-terrorism financing (CTF) regulations.

This scrutiny follows an independent audit of Binance Australia, with AUSTRAC stating that the review was “limited,” given the exchange’s size and the complex risks it faces.

Key issues flagged by the agency include excessive turnover among staff, a lack of adequate local resources, and insufficient supervision from senior management. 

AUSTRAC emphasized the necessity for strong systems that comply with local laws, particularly considering Binance’s expansive global footprint. 

Brendan Thomas, CEO of AUSTRAC, highlighted the critical importance of diligent customer identification and transaction monitoring in environments marked by high risk. Thomas remarked:

Given the global nature of this company, we expect rigorous customer verification, thorough due diligence, and efficient monitoring of transactions.

Worldwide Compliance Concerns

Binance has a window of 28 days to select an external auditor to address these pressing issues. Matt Poblocki, General Manager for Binance Australia and New Zealand, reassured stakeholders that the exchange has been engaging cooperatively with AUSTRAC.

The leadership team reiterated their dedication to upholding compliance standards and enhancing operational capabilities to mitigate any regulatory risks.

Established in 2017, Binance quickly rose to prominence, becoming the world’s largest cryptocurrency exchange by trading volume. However, the path has been fraught with complications.

Originally based in China, the company relocated its operations abroad in response to a rigorous crackdown by Chinese authorities on the cryptocurrency sector. Despite its expansion, Binance has faced allegations in several jurisdictions of being a conduit for laundering funds linked to criminal enterprises.

In a significant legal twist, Zhao pleaded guilty to breaking U.S. anti-money laundering laws in late 2023, serving a four-month sentence in 2024. Reports suggest that Zhao, despite being prohibited from leadership roles within the exchange, may seek a pardon from President Donald Trump, known for his pro-cryptocurrency stance.

These ongoing legal battles have intensified scrutiny on Binance, with the appointment of new CEO Richard Teng marking a potential shift as regulators globally intensify their oversight efforts.

Amidst the challenges posed by AUSTRAC, Binance’s native token, BNB, has notably reached an all-time high of $882, illustrating resilient investor confidence—even as broader market conditions remain volatile.

Featured image from DALL-E, chart from TradingView.com