Binance, the world’s largest crypto exchange, has unwittingly blocked thousands of Iranian accounts when it should not have blocked them due to US sanctions. According to former employees, the exchange has blocked the accounts of some Iranian customers. Customers had to withdraw their money. However, Binance did not explain why.
Binance unnecessarily blocked thousands of accounts!
As you follow on Kriptokoin.com, Binance has been a subject of intense worldwide interest in every aspect for a long time. Among the most controversial allegations are reports that the company has been serving traders and firms in Iran for years despite US sanctions banning such activities. Some critics claim that the company is not doing enough to adapt. However, it now seems that the stock market may have gone too far in the opposite direction.
To be clear, being Iranian does not mean that you are prohibited from using Binance services. You just don’t have to live there. But in thousands of cases, the company failed to make this distinction. That’s why the exchange accidentally blocked the accounts of some Iranian customers. Chagri Poyraz, Binance’s Head of Global Sanctions, says that although his company has come a long way in improving compliance protocols, especially since last year, the trading platform’s efforts to remove sanctioned customers from its database often result in customers’ accounts being blocked. In this context, Poyraz makes the following statement:
This is still unfortunate. I’m not covering it. We have largely resolved the issue. Maybe it’s late! Because it took us up to six months to clear the backlog on all these blocked and unblocked accounts. But we are solving it.
Binance did not say the real reason for the blocked transactions!
Binance said that when Iranian client accounts are blocked, they usually withdraw their funds. Or, in some cases, Binance has given them the opportunity to prove they have legal residence outside of Iran. However, it sometimes took months for these customers to prove that they were no longer living in Iran. Therefore, during this time, Iranian customers were unable to make any trades. Or, there were no possibilities to move crypto from one wallet to another.
According to three former customer service representatives, the process of receiving calls from Iranian customers within Binance who realized their account was blocked was not always a transparent process. According to the representatives, it was difficult to make a statement with Iranian customers. Because sometimes Iranian clients were instructed to avoid explaining that the reason their account was blocked and they had to withdraw their funds was because of their ties to Iran. “We couldn’t tell them why they were banned,” says one former employee. Another former employee confirms the ban. “We couldn’t tell them the truth,” he says in this context. On the subject, Binance made the following statement:
It has set minimum Binance business requirements and guidelines to mitigate potential compliance, regulatory and reputational risks associated with violating and avoiding global sanctions policy, enforcement laws and regulations in the jurisdictions in which we operate, and any risk of doing business with sanctioned parties in any jurisdiction.
“We don’t do this by nationality!”
Poyraz says Binance’s efforts to remove Iranian accounts sometimes trap Iranians who should be allowed to continue using the platform. But he states that the company never intended to separate a group of people. In this regard, he said, “I do not divide people by nationality. Because their nationality does not include them under the sanction,” he says.
Tigran Gambaryan, Binance’s head of financial crimes compliance, said, “Taking care of countries with extensive sanctions is a delicate business. We don’t do this by nationality. We do it based on where they are,” he explains.
However, Poyraz, who has more than 100 million active users and thousands of customers with ties to Iran, says that the months-long deciphering process of which Iranian customers are in harmony is both a complex and time-consuming process.
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