India places an obligation on virtual digital asset providers, like cryptocurrencies, to register themselves with their Financial Intelligence Unit (‘FIU’). This is done as an attempt to ensure such providers are complying with the country’s anti-money laundering rules and regulations. Failure to register correctly has previously seen other crypto exchanges face increased financial penalties. KuCoin was one of these. Despite registering with the FIU in March, the crypto exchange faced a penalty of 3.45m rupees (£32,700).
One of the largest cryptocurrencies, Binance, has been the most recent to have violated India’s anti-money laundering regulations under similar circumstances. This occurred in May where, despite also registering with FIU, was fined 188.2m rupees (£1.78m) for operating in violation of India’s regulations. This was not the first time Binance had experienced similar issues. In the same month, Canada’s anti-money laundering teams also imposed a fine of $4.38m (£792,500) on the crypto exchange, again for violating anti-money laundering rules.
Additionally, the ex-chief executive, Changpeng Zhao, was handed down a four-month prison sentence in May in Seattle, US. This was ordered after Zhao pleaded guilty to Canada’s anti-money laundering laws.
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