30s Summary

Binance, the world’s largest crypto exchange, plans to strengthen its compliance department, aiming for a staff of 650 by year-end, a 34% increase from last November. The move follows a $4.3 billion fine in the US for violating the Bank Secrecy Act. Richard Teng, who replaced former CEO Changpeng “CZ” Zhao, is now striving to make Binance a model of regulatory compliance. Several key appointments have been made from the Internal Revenue Service and reputable financial institutions such as PayPal, signaling a shift towards regulatory compliance and sustainable growth.

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Binance, the globe’s biggest crypto exchange, is amping up its compliance department big time. They expect to be almost 650 staff strong by year-end — a 34% boost compared to last November. That’s not all. Counting contractors, they already have more than 1,000 folks charged with keeping things compliant, according to Binance’s own statement.

Now, this keen interest in regulatory compliance is kind of a big deal for Binance. Why? Just a year back, they had to shell out a whopping $4.3 billion as fine to different U.S. regulators. The fine came about as they broke the Bank Secrecy Act (BSA) rules and knowingly allowed users to bypass international sanctions. This led to Binance’s main man, Changpeng “CZ” Zhao agreeing to quit as CEO and facing a four-month jail term for breaking the BSA.

After Zhao’s exit, Binance went into a regulatory compliance overdrive under the stewardship of Richard Teng, a former regulator in Singapore and the UAE. Teng is betting on turning Binance into a paragon of regulatory compliance — a move he believes is essential for their long-term dedication.

Sure, Teng’s entry has sped up Binance’s compliance goals. But Binance has made efforts to be on the right side of regulators much before Zhao took his leave in November 2023. Two key Binance compliance hires were Tigran Gambaryan from the Internal Revenue Service (IRS) in 2021 and Noah Perlman in January 2023 as Binance’s Chief Compliance Officer. And to show their commitment to compliance, Binance upped its compliance spending by 36% in 2023.

In Perlman’s words, they’ve entered a new phase where regulatory compliance is key to user protection, business success, and growth. He adds that Binance has evolved with regulators and other players, and the growth of their compliance team is a proof of that and the industry’s shift towards sustainable growth.

Binance has recently hired talent with deep experience in traditional finance and government. Todd McElduff, Binance’s new Enterprise Compliance Director, was previously in charge of the global financial crimes oversight division at PayPal and had a stint at Morgan Stanley. Binance also hired two special investigations specialists, Céline Inial for France and Caner Akyürek for Turkey, both with close to two decades of law enforcement experience in their home countries.

Perlman assures they’re constantly on the lookout for top compliance folks to fortify their industry-leading compliance program. With their compliance team expanding, they’re committed to protecting their global user base, which is already over 240 million strong.