The Federal High Court in Abuja has issued an order compelling Binance Holdings Limited, owners of the largest cryptocurrency exchange, to provide the Economic and Financial Crimes Commission (EFCC) with comprehensive data on all persons trading on its platform from Nigeria.
The court’s decision came as a result of an ex-parte motion filed by the EFCC, seeking detailed information about Nigerians engaged in trading activities on Binance. The suit, marked FHC/ABJ/CS/259/2024 and dated February 29, was initiated under various sections of the Economic and Financial Crimes Establishment Act, 2004, and the Money Laundering (Prevention and Prohibition) Act, 2022 (as amended).
In an affidavit supporting the motion, deposed to by EFCC operative Hamma Bello, it was revealed that the commission’s Special Investigation Team received intelligence indicating potential money laundering and terrorism financing activities being conducted on Binance.
Bello highlighted that Binance was duly informed of the damage its platform’s activities had caused and was requested to delist the Naira and provide the Office of the National Security Adviser (ONSA) with information on Nigerian users. According to information obtained from Binance, trading volume from Nigeria in 2023 alone amounted to $21.6 billion.
The team commenced an investigation, uncovering instances of market manipulation and distortion resulting in the devaluation of the Naira against other currencies, the court was told.
Bello highlighted that Binance was duly informed of the damage its platform’s activities had caused and was requested to delist the Naira and provide the Office of the National Security Adviser (ONSA) with information on Nigerian users. According to information obtained from Binance, trading volume from Nigeria in 2023 alone amounted to $21.6 billion.
“Our Special Investigation Team, stationed at the Office of the National Security Adviser, received a tip-off about illegal activities involving money laundering and terrorism financing on Binance, a cryptocurrency exchange platform. Upon receiving the tip-off, our team began looking into the platform’s activities. We discovered users exploiting the platform to influence prices, confirm transactions, and manipulate the market, causing major disruptions and devaluation of the Naira against other currencies,” Bello said.
The court order comes amid ongoing legal proceedings involving two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla, who were detained upon their arrival in Nigeria on February 26. Their detention, linked to Nigeria’s ban on several cryptocurrency trading websites, has raised questions regarding the legality and grounds for their continued detention.
Justice Emeka Nwite said, “The application submitted on February 29, 2024, is approved as requested. This court orders Binance operators to provide the Commission with detailed data on all Nigerian traders using its platform.”
According to Olayemi Cardoso, Governor of the Central Bank of Nigeria, the online exchange for cryptocurrencies, Binance, has recently come under scrutiny with allegations of facilitating untraceable financial transactions amounting to billions of dollars. The apex bank disclosed that over $26 billion was channeled through Binance without traces in the last year.
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