Binance Denies Sanctions Violations Amid Allegations of Dismissed Compliance Staff

Binance CEO Richard Teng denied allegations in a Fortune report that the exchange dismissed compliance investigators who flagged $1 billion in Tether transactions linked to Iran. Teng emphasized no sanctions violations were found during internal reviews and denied claims that investigators were fired for raising concerns. Binance reiterated its commitment to meeting regulatory obligations and has asked Fortune to correct the report.

The allegations emerged as part of ongoing scrutiny of Binance's compliance practices following its 2023 legal settlement with U.S. authorities. The report stated that at least five compliance team members with law enforcement backgrounds were dismissed after submitting findings on suspicious transactions. Critics questioned whether this undermined the integrity of the exchange's compliance structure.

Binance's former CEO, Changpeng Zhao (CZ), rejected the narrative as 'self-contradicting' and pointed to the use of third-party AML tools. He argued that if investigators failed to prevent the transactions, the claims could also be directed at them. Binance has also stated no personnel were terminated for reporting sanctions concerns.

Why Did This Happen?

The report alleged that Binance's compliance team identified suspicious transactions involving Iranian-linked entities between March 2024 and August 2025. These transactions were primarily conducted via Tether (USDT) on the Tron blockchain. The claims suggest the transactions may have been used to evade U.S. sanctions against Iran.

Binance has denied the allegations, stating no evidence of sanctions violations was found during internal reviews. The company emphasized it has strengthened its compliance infrastructure since the 2023 settlement. Binance also highlighted its use of external AML tools to screen transactions.

How Did Markets React?

The controversy has raised questions about the adequacy of Binance's compliance controls under the government-imposed monitorship. Legal experts have criticized the potential implications for the exchange's regulatory standing. The situation comes amid broader concerns about the use of stablecoins for sanctions evasion.

Binance has sought to address the claims through public statements and by requesting corrections to the report. The exchange's reputation remains under scrutiny as it continues to navigate regulatory challenges globally.

What Are Analysts Watching Next?

The allegations are part of a larger pattern of cryptocurrency sanctions enforcement that has intensified since 2023. Regulators have taken action against non-compliant exchanges, including ShapeShift and the Cryptex network. Analysts are watching whether Binance's compliance reforms will be sufficient to avoid further regulatory action.

Binance is also reportedly in discussions with the U.S. Department of Justice to lift the independent compliance monitor requirement from its 2023 settlement. If approved, the removal of the monitor could ease regulatory pressure on the exchange. However, critics have raised concerns about the risks of reduced oversight.

The situation highlights the ongoing challenges crypto exchanges face in adapting to evolving sanctions enforcement. As stablecoins become more prominent in global finance, their use for sanctions evasion remains a key regulatory concern. Binance's response to these allegations will likely have broader implications for the crypto industry's approach to compliance.