French Prosecutors Launch Investigation into Binance for Money Laundering and Tax Fraud Allegations

French prosecutors have launched an investigation into Binance. They are looking into allegations of money laundering and tax fraud.

The Paris Public Prosecutor’s Office is examining Binance's activities from 2019 to 2024. This probe focuses on claims that the exchange was involved in money laundering related to drug trafficking.

According to a report from Reuters on January 28, the economic and financial crime division of the prosecutor's office is also investigating whether Binance misled its users. Some users have reported that incorrect information from the exchange led to their investment losses.

Earlier reports indicated that French authorities have been investigating Binance since at least 2022. They are concerned about money laundering and other illegal activities.

French regulators are stepping up their scrutiny of cryptocurrency service providers. However, they continue to authorize companies to operate in the country, as long as they have the proper licenses.

This investigation into Binance comes just after Bybit announced it would stop operating in France due to regulatory challenges.

Binance is facing legal issues around the world, not just in France. In the United States, the Securities and Exchange Commission is pursuing a civil lawsuit against the exchange. This lawsuit was filed in 2023, even though there are reports that the SEC might change its approach with new leadership.

Former Binance CEO Changpeng “CZ” Zhao served four months in federal prison in 2024. He pleaded guilty to a felony charge as part of a deal with U.S. authorities. Although Zhao has stepped back from his role at Binance, the company recently announced he would take an active role in its technology incubator, now called YZi Labs.

In December, the Australian Securities and Investments Commission also took action against Binance’s local derivatives division. They claimed that Binance did not provide adequate consumer protection. Specifically, they alleged that the platform misclassified over 500 retail clients as wholesale investors between 2022 and 2023.