Binance Schulten User in the circumvention of KYC and AML rules (report)
Binance Schulten User in the circumvention of KYC and AML rules (report)
On March 23, CNBC reported that a group of Binance Angel's techniques shared that enable users to bypass the platform's KYC, residence and verification systems.
CNBC confirmed the information by checking hundreds of messages that were posted on a discord server and a telegram group controlled by Binance, which apparently ran from 2021 to March 2023.
crypto is prohibited in China, but employees and volunteers from Binance explain to people how they can handle the ban https://t.co/ddsytwimh
-cnbc (@cnbc) 24. March 2023
kyc? What kind of kyc?
According to CNBC, a number of bony employees and "angels" (volunteers who were trained by the stock exchange to promote their use) provided video instructions and tutorials that show the steps for users to fake bank documents and to indicate incorrect addresses when registering on the platform.
The employees even showed techniques for falsifying their residence to obtain Binance debit cards.
"A person who uses the Handle Yaya and identified as an employee of Binance asked them to activate their VPN and register as a resident of Taiwans and then change their nationality back to China. The employee also proposed to avoid the use of VPN nodes in the United States, Singapore and Hong Kong."
The report also revealed that many users in China have been able to access the services of Binance since 2021 despite the ban on the ban on the exchange of cryptocurrencies since 2017 and the use of digital assets.
Binance examines the report
CNBC said that "the techniques that are shared with and among customers also question the effectiveness of the efforts of bony to combat money laundering", which arouses doubts about the ability of the stock exchange to ensure that their customers are not involved in illegal money laundering or terrorist financing activities.
Likewise, several regulatory experts, such as Sultan Meghji, professor and former Chief Innovation Officer at FDIC, expressed their concern about the ability of Binance to comply with the KYC and AML regulations. They pointed out that such reports raise regulatory concerns regarding the platform because they could allow transactions from terrorists or criminals from North Korea or Russia.
"If I had 8 out of 10 concerns about binance from the perspective of national security, this expressly brings this to the effects on national security, such as terrorists, criminals, money launderers, cyber people in North Korea, Russian oligarchs, etc.
JIM Richards, anti-money laundering manager from Wells Fargo, emphasized that "the techniques for bypass the KYC controls from Binance could have effects beyond China", precisely because the stock exchange could support operations from other sanctioned countries.
According to a spokesman for Binance, the stock exchange has already taken action against employees who may have violated the company's internal guidelines, have made prohibited recommendations and violated its rules. Employees who violate these guidelines are checked and can be released immediately.
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