- Reportedly, the insiders shared techniques that can be used to evade Binance’s KYC, residency, as well as verification systems.
- The report claims that employees, volunteers, and customers shared video guides and documents on how to falsify their country of residence to obtain Binance’s debit card.
Leading cryptocurrency exchange Binance is now facing scathing allegations of misconduct. The latest report by CNBC claims that Binance employees have been helping customers in China to bypass the exchange’s Know Your Customer Controls (KYC).
Reportedly, the discord and Telegram messages CNBC reviewed come from accounts identified as Binance employees/Binance-trained volunteers called “Angels.” The report alleges that in these messages, the insiders shared techniques that can be used to evade Binance’s KYC, residency, and verification systems.
Techniques shared to evade KYC controls include forging bank papers, attesting false addresses, and other simple system manipulations.
The report claims that employees, volunteers, and customers further shared video guides and documents on falsifying their country of residence to obtain Binance’s debit card, effectively turning their Binance crypto into a conventional checking account.
In response to the allegations, a Binance spokesperson stated: “We have taken action against employees who may have violated our internal policies, including wrongly soliciting or making recommendations that are not allowed or in line with our standards. We have strict policies requiring all users to pass KYC by providing us with their country of residence and other personal identification information.”
In 2021, soon after China banned cryptocurrency, Binance stopped letting Chinese mobile phone numbers register and blocked Chinese IP addresses. The report notes that despite many Chinese customers, h continued to seek ways to trade on Binance, which included using instructions provided by Binance employees. The report further goes on to list several examples of Binnace employees and volunteers helping users in China evade KYC rules.
The report claims that in December 2022, a person with the handle Stella, who was later identified as a Binance community manager, posted messages in a server-wide announcement channel detailing how people could use a specialized “VPN-free” domain name and also download an app that appears to be specifically made for customers in mainland China to use Binance services.
The latest development comes amid the exchange facing mounting criticism over its alleged regulatory noncompliance. Earlier this year, a report surfaced that Binance conceived a plan to deceive US regulators after it became apparent that authorities were cracking down on the industry.
Last month, Binance’s Chief Strategy Officer Patrick Hillmann said in an interview that the exchange had earlier “gaps” in its regulatory compliance that have since been closed.