Binance and former CEO Changpeng Zhao face a class-action lawsuit in Seattle, alleging consumer harm from the exchange’s money laundering activities. The suit claims they prioritized profits by enabling illicit actors to launder funds.
In a Seattle Federal court, a new class-action lawsuit has been filed against Binance and its former CEO, Changpeng Zhao, for alleged consumer injury resulting from the exchange’s money laundering activities.
The defendants are alleged to have prioritised profits over the law in the litigation, as they allegedly generated substantial income by enabling notorious actors to conceal their funds.
Plaintiff Emphasises The Wilful Violations of Binance
In a class action complaint filed on August 16 in the U.S. District Court for the Western District of Washington, Seattle, the plaintiffs contended that “the defendants wilfully violated the Bank Secrecy Act by failing to implement and maintain an effective Anti-money laundering program, disregarded the crucial KYC rules, and violated US economic sanctions in a deliberate and calculated effort to profit from the U.S. market.”
“The Empire of Crypto-Wash”
The filing also emphasised that the Defendants’ wilful disregard of these critical laws and regulations caused Binance.com to become a magnet and centre for criminals, terrorists, and other bad actors.
Additionally, Binance.com became the preferred choice as the “get-away driver” for a significant number of bad actors. Binance is referred to as the “Crypto-Wash Empire” in the lawsuit.
The plaintiffs contended that a perpetual record of crypto transactions on the blockchain is a critical attribute of these transactions, rendering them “permanently and accurately traceable.”
Therefore, in the absence of a cryptocurrency laundering platform, such as Binance.com, there is a possibility that the authorities could ultimately locate the perpetrator by retracing their steps on the blockchain if a malicious actor steals someone else’s cryptocurrency.
The most recent class action litigation, according to Bill Hughes, a lawyer at Consensys, is a “natural, predictable follow-on civil action” that aims to profit from government prosecutions and enforcement actions. Nevertheless, he expressed his scepticism regarding the suit’s ability to substantiate these allegations.
He also emphasised that “the efficacy of blockchain analytics and on-chain asset recovery will be put to the test if this case proceeds to discovery and dispositive pre-trial motions.”
