Democrats in the US Senate continue to pile on Binance, asking the Treasury and Justice Departments to investigate its compliance with sanctions and protections against illicit financing following reports of potential terrorist financing.
Nine senators, including a few who have been instrumental in negotiating the crypto industry legislation known as the Digital Asset Market Clarity Act, sent a letter to the heads of federal agencies on Friday requesting an investigation into the exchange following news reports of possible breaches, which also claimed the company had fired some of the compliance staff involved in discovering the transaction.
The latest move by Democrats follows an announcement earlier this week by Sen. Richard Blumenthal, a Connecticut Democrat who is a senior member of the Senate Homeland Security Committee, that he questioned Binance and had written a letter to the company asking for information. However, neither he nor the other Senate Democrats are in the majority, meaning they currently do not have control over committee investigations.
Richard Teng, Binance co-CEO, has said that some of the earlier media reports were “inaccurate” and “defamatory”. A company spokesman did not immediately respond to a request for comment Friday on the senators’ request, which had been sent to Treasury Secretary Scott Bessent and Attorney General Pam Bondi.
“These allegations raise serious concerns that poor illicit financial controls at Binance remain a significant threat to national security,” according to the Friday letter from senators including Elizabeth Warren, Ruben Gallego, Angela Alsobrooks, Mark Warner and five others, who also asked for information on the company’s compliance with the requirements of its 2023 settlement.
“Our illicit financial controls are dangerously compromised if huge sums of money could flow through Binance to terrorist groups or sanctions evaders,” they wrote in the letter, which comes at a sensitive time in the ongoing discussions about US legislation that would govern crypto markets.
Preventing illegal financing in crypto is among the issues still being discussed in that bill. Senator Warner has taken the lead among Democrats seeking to hash out legislative language on the issue.
Another unresolved issue centers around US President Donald Trump and his family’s crypto activities, which the letter also referenced. The lawmakers wrote that they “acknowledged” Binance had links to World Liberty Financial, the Trump-backed crypto venture behind the USD1 stablecoin. They also referred to Trump’s pardon of Binance founder Changpeng “CZ” Zhao — he had pleaded guilty and served four months in prison in connection with Binance’s past anti-money laundering and know-your-customer issues.
