Ex-Binance Investigator Alleges $1.2B Iran-Linked Account Probe Was Ignored

A former senior financial crimes investigator at Binance has accused the cryptocurrency exchange of ignoring an internal investigation into about 2,000 accounts suspected of having links to Iran.

Based on a Forbes report on November 9, he made the claims during an interview with IRS agents in May, saying the accounts had moved approximately $1.2 billion through the platform.

According to a search warrant later issued for the former investigator’s MacBook, the investigation was known internally as “Operation Loclock.” The investigator claimed that Binance management ignored repeated requests to examine the accounts, which were suspected of being used by people in Iran to move money through the exchange.

How the investigation started

According to the cited New York Times report, the investigation began after Binance’s compliance team discovered suspicious transactions involving accounts connected to Iranian entities. The findings included two major cases involving businesses that used the exchange to move cryptocurrency.

One of the most important discoveries involved Blessed Trust, a Hong Kong-based company that worked with Binance as a financial services partner. Such partners help crypto exchanges handle payments and convert between traditional money and digital assets.

According to documents reviewed by investigators, around $1.2 billion in cryptocurrency moved from Blessed Trust’s Binance account to entities linked to Iran over roughly two years.

The investigators also found connections between some of the receiving wallets and addresses controlled by Iran’s Islamic Revolutionary Guards Corps (IRGC). The group has been designated a terrorist organization by the United States.

The findings raised concerns because transactions involving sanctioned entities could violate U.S. law. Investigators also discovered that people in Iran had gained access to more than 1,500 Binance accounts during the previous year.

Investigators suspended after raising concerns

The investigators reportedly brought their findings to senior Binance executives, including CEO Richard Teng and Chief Compliance Officer Noah Perlman.

However, Forbes said the situation changed in November when two investigators involved in the case were suspended. Two other employees who continued the investigation were also suspended within days and reportedly lost access to Binance’s internal systems.

The former senior investigator later told IRS agents that he left Binance shortly after the company suspended him and several colleagues.

The timing of the suspensions raised questions about whether the employees were punished for reporting the suspicious transactions. However, Binance has strongly denied this claim.

Binance and Blessed Trust deny wrongdoing

Binance spokesperson Rachel Conlan said the exchange did not stop the investigation and took action after receiving the findings.

“Any suggestion that Binance knowingly allowed sanctionable activity to continue unchecked is incorrect and defamatory,” Conlan said.

She explained that the employees were disciplined over the unauthorized disclosure of confidential client information, not for raising compliance concerns. Binance also said it removed the accounts involved and shared information about Blessed Trust with the IRS and FBI.

The company further said there were several intermediary wallets between Blessed Trust and the wallets allegedly linked to the IRGC. It also confirmed that it stopped using Blessed Trust as a vendor in January.

Blessed Trust has also rejected claims that it knowingly helped move money in violation of sanctions. Its director, Leung Ka Kui, said the company never made payments to Iranian entities and described its work with Binance as routine business payments, including settling invoices and paying employees.

U.S. authorities expand Binance investigation

The allegations come as U.S. authorities continue examining Binance’s handling of transactions involving Iran. In September, Bloomberg reported that federal prosecutors were investigating whether the exchange knowingly allowed trading activity that violated U.S. sanctions. Reuters later confirmed the report.

The IRS and Department of Justice have since issued multiple subpoenas and search warrants involving Binance and some former employees.

The investigation also brings renewed attention to Binance’s previous legal problems. In 2023, the exchange pleaded guilty to violating U.S. anti-money-laundering and sanctions laws, including allowing customers in Iran and other sanctioned regions to use its platform. It agreed to pay approximately $4.3 billion in penalties and promised to strengthen its compliance systems.

The latest allegations raise further questions about whether those changes were enough to prevent suspicious transactions from passing through the exchange.

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