Binance Targeted by Unknown Nigerian Officials for Cryptocurrency Settlement, CEO Claims

Richard Teng, CEO of Binance, disclosed that during a meeting in Nigeria in early 2024, company representatives were approached by unidentified individuals proposing a secret settlement. 

This proposal, suggested immediately after a contentious meeting with Nigerian lawmakers, involved a large sum of cryptocurrency intended to settle allegations of tax evasion and money laundering against Binance.

Background of the Incident

The situation unfolded against the backdrop of ongoing tensions between Binance and Nigerian authorities. 

In 2023, Nigerian financial regulators had already instructed Binance to cease its investor solicitation efforts within the country. Complying with these demands, Binance halted its advertising and sought to engage with government officials to clarify its operations and intentions in Nigeria.

On January 8, 2024, Tigran Gambaryan, a former U.S. IRS agent who led Binance's financial crime compliance team, along with other Binance employees, met with Nigerian lawmakers. This meeting quickly turned adversarial, with lawmakers reading a list of serious accusations against Binance and threatening to arrest Mr. Teng. 

According to Teng’s account, as the Binance representatives left the meeting, they were approached by these "unknown persons" who suggested a covert financial transaction to clear the charges. A local lawyer for Binance later encountered a person claiming to be an agent of the House committee demanding $150 million in cryptocurrency within 48 hours.

In order to ensure their safety, Binance's team immediately left Nigeria. Teng said the company saw the payment demand as a forced settlement attempt rather than a legitimate settlement offer. 

Detention and Escalation

The situation escalated when Nigerian officials took further drastic measures. Following their initial meetings and despite assurances of safe conduct, Tigran Gambaryan and Nadeem Anjarwalla were detained when they met Nigerian authorities last March. Their detention occurred under accusations of Binance facilitating illegal transactions and profiting locally without proper authorization. 

Both individuals had their passports and personal phones confiscated, effectively limiting their ability to communicate or leave the country.

In response to these aggressive tactics, Binance shut down certain services within Nigeria, aiming to protect its employees and pressure the Nigerian government for their release. However, the Nigerian government maintained that the release of Gambaryan would only occur if Binance complied fully with their demands.

Nigerian Government's Stance and International Observations

Zakari Mijinyawa, a spokesperson for Nigeria's national security adviser, later stated that the government would present its case based on strong evidence and due process. He assured that Binance would have every opportunity to defend itself in court.

Richard Teng has been vocal about the challenges faced, describing the ordeal as setting a "dangerous new precedent" that could affect all companies operating internationally. According to him, detaining mid-level employees such as Gambaryan who were actively involved in building compliance frameworks, but who had no decision-making authority regarding Binance's operational strategies, was unjust.