U.S. federal prosecutors are investigating whether Binance violated American sanctions against Iran by failing to stop certain trading activity on its platform, bringing renewed scrutiny to the exchange’s compliance controls nearly three years after its landmark settlement with U.S. authorities.
The investigation is being led by the Manhattan U.S. Attorney’s Office, with the Justice Department’s Criminal Division in Washington also involved, Bloomberg reported on September 21, citing people familiar with the matter. Authorities are examining whether Binance knowingly permitted the transactions.
The specific transactions being examined have not been publicly identified, and no charges have been announced. A federal investigation does not establish wrongdoing and can conclude without charges.
Binance said it maintains “a zero-tolerance policy for sanctions violations,” adding that it cooperates with law enforcement and remains committed to identifying and removing bad actors.
Iran Transactions Return to the Center of Binance Scrutiny
The latest reporting provides new details about an investigation first disclosed in March, when the Wall Street Journal reported that the Justice Department was examining whether Iran used Binance to circumvent U.S. sanctions and channel money toward networks supporting Iran-backed groups, including Yemen’s Houthis. At that stage, it was unclear whether prosecutors were investigating Binance itself, individual users or both.
Scrutiny intensified this month. On September 14, Manhattan federal prosecutors filed a civil forfeiture complaint seeking approximately $61 million in cryptocurrency allegedly derived from black-market sales of sanctioned Iranian crude oil and petroleum products.
The Justice Department alleges that two Chinese companies, Blessed Trust and Hexa Whale, used accounts at Binance to launder oil proceeds and funnel money to the Iranian government, its agents or proxies, including the Islamic Revolutionary Guard Corps. The complaint says the companies collectively handled more than $1.5 billion connected to the scheme.
Importantly, that civil forfeiture complaint targets the cryptocurrency, not Binance, and does not accuse the exchange itself of wrongdoing.
$4.3 Billion Settlement Looms Over New Investigation
The investigation carries additional significance because Binance already admitted U.S. compliance failures in 2023.
The exchange agreed to pay approximately $4.3 billion to resolve investigations involving sanctions, anti-money-laundering and money-transmission violations. Founder Changpeng Zhao stepped down as chief executive and separately pleaded guilty to failing to maintain an effective anti-money-laundering program.
That settlement included extensive compliance obligations intended to prevent sanctioned users from accessing the platform.
The new investigation therefore centers on whether Binance’s controls subsequently failed to prevent prohibited Iran-linked activity and, critically, whether any such transactions were knowingly allowed.
Iran-related crypto activity has become a wider enforcement priority for Washington. On September 17, the Treasury sanctioned Iranian exchange BitBank, alleging it facilitated hundreds of millions of dollars in Bitcoin transfers to the IRGC.
Treasury has also targeted other exchanges and financial networks it says helped Iran preserve access to international markets through digital assets.
For Binance, the central question is now narrower but potentially consequential: whether Iran-linked transactions merely passed through accounts that evaded its controls, or whether prosecutors can establish that the exchange knowingly permitted activity prohibited under U.S. sanctions law.