Binance has replied to a letter from U.S. Senators from March inquiring about its cryptocurrency exchange activities within the country, including its financial statements.
On March 18, a report revealed that Binance's response did not contain the requested financial information. Nonetheless, an anonymous source informed Bloomberg that the exchange had already sent the details to U.S. regulators, despite their omission from the letter. In a 14-page document, Binance's chief strategy officer, Patrick Hillman, discussed the exchange's compliance record, acknowledged previous errors, and claimed to have established robust Know Your Customer and Anti-Money Laundering policies in recent years. However, the response failed to address the senators' concerns regarding Binance's lack of transparency.
Hillman noted in the letter:
"Binance leverages both internal tools and tools from established third-party vendors to scan user transactions and profiles in real time [...] between August 2021 and November 2022, Binance stopped over 54,000 transactions as a result of transaction monitoring alerts."
On March 2, three U.S. senators led by Elizabeth Warren sent a letter to Binance CEO Changpeng “CZ” Zhao and Binance.US CEO Brian Shroder, raising concerns about Binance's activities and requesting the companies balance sheets.
According to the Senators, there is evidence that Binance and its American arm attempted to evade U.S. regulators, evade sanctions and facilitated the laundering of at least $10 billion. “What little information about Binance’s finances is available to the public suggests that the exchange is a hotbed of illegal financial activity,” the senators wrote in the letter.
Binance has previously stated that the two companies are separate entities with independent management and operations.
Among the senator's requests were “all Binance and Binance subsidiary balance sheets from 2017 to the present,” as well as Anti-Money Laundering and similar policies, and documents about the relationship between Binance and Binance.US.
The U.S. Securities and Exchange Commission (SEC) launched in February a probe into Binance.US regarding trading firms alleged to be connected to Binance CEO Changpeng Zhao. An investigative report has suggested that Binance was behind a transfer of roughly $400 million in funds from a Binance.US account to a trading firm managed by CEO Changpeng Zhao.