This week the developments at Binance continue to enthrall us, while the world of sports scores a hat trick in the financial crime headlines as the USA’s corruption probe into FIFA announces its findings, a former Malaysian sports minister is in the dock for money laundering, and an American Olympic gold medalist is charged with cryptocurrency fraud.
Find out more on these stories below.
Binance ‘not capable’ of being effectively supervised, says the FCA
Binance is still dominating headlines this week with the announcement that the FCA believes it to be incapable of being effectively supervised, while in APAC, Binance Singapore has appointed as its new CEO the former CEO of Abu Dhabi’s Global Market’s Financial Services Regulatory Authority (FSRA).
Earlier this week the FCA published a notice indicating that Binance Markets Limited (BML), a London-based affiliate of Binance, failed to supply requested details about its business model and wider product offerings in response to the FCA’s formal information requests under UK anti-money laundering regulations. The report further claimed that BML failed to “provide details about how the business and Group are organised; explain what routes UK consumers could use to purchase products; and identify the legal entity behind the website.”
As a result, the FCA deemed BML ‘not capable of being effectively supervised’, since the firm is part of a global group offering financial products which, the FCA says, poses a significant risk to consumers. The Group is the world’s largest global crypto exchange; 24-hour spot trading volumes were estimated at between $11 billion and $38 billion during June 2021 and they had 316 crypto assets supported across 1138 trading pairs.
In response the regulator’s statement, BML said that it has complied with all of the FCA’s requirements and continues to engage with the regulator to resolve issues that may still exist.
Meanwhile, Binance Singapore appointed Richard Teng as CEO. With a repertoire of experience within the regulatory space, Teng was previously the CEO of Abu Dhabi’s FRSA, also a former Regulatory Officer of Singapore Exchanges, and spent 13 years with the Monetary Authority of Singapore (MAS), where he rose to become the Director of Corporate Finance.
Read more on this story at www.fca.org.uk
FIFA to get $201m ‘remission’ as result of USA’s financial crime probe into corrupt officials
Earlier this week the Department of Justice (DOJ) announced that several regional FIFA bodies will be awarded $201m as a remission following a six-year investigation into allegations of bribery and corruption among FIFA officials.
The $201m (£146m) award is welcome news for FIFA - the ironic result of the Justice Department’s successful investigation into the conduct of the world football governing body’s own officials, which started six years ago.
In 2015, the DOJ charged 30 FIFA officials with racketeering, wire fraud and conspiracy to commit money laundering, alleging that over $150m (£109m) in bribes were paid, mostly by sports marketing companies, to FIFA officials.
Perpetrated over a period of almost 25 years, the kickbacks from bribing corrupt officials involved procuring lucrative media and marketing contracts at football tournaments. By August 2021, over 50 people and corporations, from more than 20 countries, were included in the indictment.
FIFA president, Gianni Infantino, thanked the US Justice Department, stating that through their 2015 intervention, the federation has “been able to fundamentally change FIFA from a toxic organisation at the time, to a highly esteemed and trusted global sports governing body.”
FIFA, and two of its regional associations, CONCACAF, and CONMEBOL, have committed to distributing the retrieved funds to football development projects in the regions most afflicted by the scandal through the newly created and independently regulated World Football Remission Fund.
Meanwhile, the DOJ’s investigation is ongoing.
Read more on this story at CNN.
Former Malaysian sports minister set to answer money laundering charges
It was announced this week that Syed Saddiq Syed Abdul, a former Minister of Youth and Sports and currently a sitting member of parliament for Malaysia’s Muar federal district, won an appeal to have his case heard in Malaysia’s high court.
Syed Saddiq faces charges of money laundering, misappropriation of funds, and criminal breach of trust (CBT). His appeal in the Kuala Lumpur High Court, citing issues of constitutionality, is set for late November.
The misappropriation of funds and money laundering are alleged to have occurred in 2018, shortly before his tenure as Youth and Sports Minister in the short-lived Pakatan Harapan administration.
Syed Saddiq, a veteran politician at just 28 and a frequent commentator on social and political issues in the country, had his phone seized by local police in May after he claimed that police brutality caused a death in custody during April.
A conviction for one or more of the charges he faces could see him serving a sentence from five years and a public whipping to 15 years and a massive fine.
Read more on this story in the Malay Mail.
American Winter Olympics legend at centre of crypto fraud charges against Malta company
Apolo Anton Ohno, a retired multiple Winter Olympics medal winner and U.S. Olympic Hall of Famer, is being sued - along with three companies he founded - in an alleged crypto fraud case estimated at $50m (£36m).
Joining him and the companies in the dock are the three individual cryptocurrency entrepreneurs, Rod Jao, Eugenio Pugliese, and Henry Liu.
The complaint, filed at a US federal court in Los Angeles by nine plaintiffs, constituted six individual claims and three on behalf of investing companies alleging that the defendants raised $50 million in digital token sales between January and June of 2018, and later misappropriated the money raised.However, the sale of the Hybrid Tokens was never registered with the United States Securities and Exchange Commission, allegedly leaving the investors out of pocket when the defendants “squandered and/or misappropriated, and purported to lose by theft, all or nearly all of the approximately $50 million raised through their offer and sale of Hybrid Tokens.”
The charge against Mr Ohno is the first in his post-skating career, though not the first accusation of illicit conduct ever levelled at him.
Read more on this story at Malta Today
Find out how to improve your AML processes with award-winning technology.
Get in touch to see how our intelligent compliance solution can help your organisation or request a demo to see it in action.