Key Takeaways
- Fine imposed for violating Dutch money-laundering laws.
- DNB moderated fine by 5%.
- Companies in the Netherlands are legally obligated to register under the Money Laundering and Terrorist Financing (Prevention) Act.
The Dutch National bank(DNB) disclosed that Binance-the world’s largest exchange was fined 3,325,000 euros in April for offering crypto services in the Netherlands without legally registering with DNB. The fine was imposed on Apr. 25, 2022. The exchange has, however, objected to the fine in June.
DNB states Binance violated Dutch money-laundering laws and had a competitive advantage against firms that did not have a DNB registration during the period it was in non-compliance ie, between May 2020 and Dec. 1, 2021. Companies offering crypto services in the Netherlands are legally obligated to register with DNB under the Money Laundering and Terrorist Financing (Prevention) Act.
According to the official statement, DNB had earlier issued a public warning to Binance in August 2021.
“The violations committed by Binance are punishable with a fine from the third category. This means that the administrative fine has a basic amount of EUR 2,000,000, a minimum amount of EUR 0, and a maximum amount of EUR 4,000,000”, reads the Dutch Central Bank’s press statement.
Further in their statement, DNB adds that it had moderated the fine by 5%, mainly because a registration application has now been submitted by Binance. The registration is now under review by DNB. The Monetary Authority had earlier increased the fine on Binance, citing that the exchange “has enjoyed a competitive advantage since has not paid any levies to DNB and has not had to incur other costs in connection with ongoing supervision by DNB”.
As per the Dutch Chamber of Commerce filings, Binance Nederland BV was established in October 2021 and has been owned by Binance Holdings Ltd. Of Ireland since Dec. 24, 2021. A Binance spokesperson talking to the media stated the fine marked a “pivot in their ongoing collaboration” with the DNB.
“While we do not share the same view on every aspect of the decision, we deeply respect the authority and professionalism of Dutch regulators to enforce regulations as they see fit,” the spokesperson said, Binance further added that it was now “pursuing a more traditional operating model in the Netherlands.” Binance had earlier said that it has increased its hiring of compliance staff and enforcement efforts to bolster its regulatory credentials.
Binance established in 2017, is slowly working on increasing its presence around the world. The crypto giant recently received regulatory registration in France investing 100 million euros in its operations in the country. Binance also secured approval to function in the Middle eastern country-Bahrain. The CZ-owned company further made headlines when it obtained provisional approval to operate as a broker-dealer in Abu Dhabi in April.
