SCAM? CBN Faults Binance For Carrying Out Banking Services Through Naira P2P Feature In Nigeria—The Central Bank of Nigeria (CBN) has faulted the Binance cryptocurrency platform for carrying out deposits and withdrawal services meant for banks and other authorized financial institutions on its platform, without authorization.
Dr. Olubukola Akinwunmi, Head of Payment Policy and Regulation Division at the CBN, told Justice Emeka Nwite of the Federal High Court, Abuja on Friday that the deposits and withdrawal transactions done on Binance platform was what banks in Nigeria were authorized by the apex bank to do.
Newsmen reports that the Nigerian government had accused Binance and its executives, Tygran Gambaryan and the fleeing Nadeem Anjarwalla, of allegedly conspiring amongst themselves to conceal the origin of the financial proceeds of their alleged unlawful activities in Nigeria, including $35,400, 000.
The Nigerian authorities allege they committed an offence contrary to Section 21 (a) and punishable under Section 18(3) of the Money Laundering (Prevention and Prohibition) Act, 2022.
What transpired during the trial
Led in evidence by counsel for the Economic and Financial Crimes Commission (EFCC), Ekele Iheanacho, the CBN staff told the court that the Binance website convinced many Nigerians to swiftly deposit and withdraw NGN or naira on Binance via a cash link.
He added that statements on the Binance website also stated it “does not charge deposit fees. For each withdrawal, a flat fee is paid by users to cover the transaction cost of moving the cryptocurrency out of their Binance account.”
He explained that “depositing and withdrawing naira is a regulated activity carried out by banks and other financial institutions duly licensed by Central Bank of Nigeria.”
He maintained that Binance was not given the authorization to carry out such transactions on its platform.
He also said that Binance facilitated conversion from naira to dollar, adding that that kind of service also required authorization by the CBN, either as an authorized giver or as a Bureau de Change.
He also told the court that traders who deal in foreign exchange on Binance “normally trade in pseudonyms” thereby hiding their identities in contravention of relevant laws.
The witness explained,
“The selling party will provide a bank account to which the buying party can send or transfer the naira amount into the account provided by the selling party.
“Once the buying party transfers the amount agreed, it clicks on a particular icon on the Binance platform to communicate the fact that he has transferred the amount.
“The Binance platform will on the side of the selling party, await confirmation based on which it will release the cryptocurrency or fiat currency.
“The Binance platform facilitated all these processes for the (naira)peer-to-peer transaction.”
After the witness’ examination, the court adjourned to July 16 for cross-examination by the defence.
Justice Nwite also ordered the Nigerian Correctional Services to produce the medical reports of the Tigran Gambaryan that day, warning the correctional service against non-compliance to the court’s directives.
He added that the medical practitioner at the prison service will have to appear in court if the medical report is not produced.
