Binance warned VIP customers about law enforcement investigations, Treasury says
Summary
Binance CEO Changpeng Zhao pleaded guilty to criminal charges in the U.S. and stepped down from his post on Tuesday as part of a $4.3 billion settlement. Members of Binances VIP team were instructed to contact the user under investigation by "all available means" including sending texts and calling to inform customers, for example, that their account had been frozen or unfrozen. According to FinCEN, internal reports from Binance indicated that in 2019, VIP customers "consistently accounted for between two-thirds and three-quarters of both trading volume and trading revenue on Binance.com, adding that "Binance thus had significant commercial motivations to go to great lengths to support these VIP users." Despite rules forbidding people in the U.S. from trading on the platform, users in the U.S. "represented a crucial element of the VIP userbase," at some points accounting for as much as 20% of all transaction fees on the exchange. [The CEOs] idea is that they should have enough time to create or find new non-US entities," the consent order stated.