Tag Archive : Lawsuit

Fisco Sued Binance for Illegal Laundering Over $9M

Fisco Sued Binance for Illegal Laundering Over $9M

Fisco representatives filed a complaint on Binance in the Northern California District Court for the stolen funds from Zaif seeking the return of over $9 million.

In the 2018 hack, Fisco, the Japanese exchange has lost nearly $60 million worth of crypto. This includes some units of Bitcoin (5966), Bitcoin Cash, and Mona coin is Japan’s first native cryptocurrency.

However, the hackers sent 1,451 bitcoin to an address that belongs to Binance. Binance, the world’s largest cryptocurrency exchange. The total bitcoin worth was $9.4 million at that time. Zaif is the name of exchange during the hack.

Fisco explains that Binance uses Amazon Web Services (AWS). AWS is to host the exchange’s servers. It has the ability to select whichever AWS data center for its operations. Since most of the infrastructure is in California the jurisdiction was in Northern California District Court.

The laundering happened due to Binance’s allegedly lax know-your-customer (KYC), and anti-money laundering (AML) protocols. These do not measure up to the industry standards. 

Fisco said,

“Binance failed to implement security measures that were standard throughout the industry.”

Either intentionally or negligently Binance did not stop the transfers. Even though it had the chance to do it. Fisco demands Binance to pay for its loss of the laundered funds. Zaif, and its customers suffered financial losses as a result of Binance’s lack of action.

Similarly, the Financial Action Task Force (FATF) found that Binance has weaker regulation. This has been singled out by them for often moving to avoid stronger regulatory oversight.

Binance has involved in a series of recent class-action lawsuits. One among them was the class-action lawsuit against the exchange was filed in the Southern District of New York. Recently, Binance has also delisted the exchange’s own native token BNB.