Nigerian tax authority drops charges against Binance execs, targets exchange directly
FIRS is now investigating allegations that Binance, the world's largest cryptocurrency exchange by trading volume, failed to file tax returns and pay required duties in Nigeria.
The Nigerian Federal Inland Revenue Service (FIRS) has dropped tax evasion charges against two Binance executives. In a surprising turn of events, the authority is now redirecting its attention to the cryptocurrency exchange itself.
FIRS is now investigating allegations that Binance, the world's largest cryptocurrency exchange by trading volume, failed to file tax returns and pay required duties in Nigeria.
This means that Tigran Gambaryan, a former US Internal Revenue Service agent leading Binance's financial compliance, and Nadeem Anjarwalla, the regional manager for Africa, are no longer personally facing tax charges. However, Binance, through its local representative, remains the defendant in the case brought by the Federal Inland Revenue Service.
This shift comes after both executives were detained in February when Nigeria cracked down on cryptocurrency platforms blamed for the naira's depreciation. Pressure mounted on Nigeria to release Gambaryan, especially after reports of his illness. US lawmakers urged President Biden to intervene, citing concerns about his health and alleging his detention was based on "baseless" charges. Nigeria maintains it followed due process.
The executives still face money laundering charges from the Economic and Financial Crimes Commission, exceeding $35 million allegedly laundered and unlicensed operation. Their hearings are set for June 19-20. Gambaryan has pleaded not guilty, while Anjarwalla remains silent on the charges.
Initially held in a comfortable guest house in Abuja, Nigeria’s capital, both detained executives had their phones and passports confiscated. Binance argued Gambaryan, leading their financial compliance, wasn't essential for resolving issues and should be released.
However, the situation escalated in March when one executive escaped. Gambaryan was then transferred to the harsher Kuje prison, known for housing terrorist inmates. His family reports his health has deteriorated, including developing pneumonia.
Andrew Christian
The conflict between Binance and Nigeria epitomises the struggle between governments and cryptocurrency platforms. As cryptocurrencies gain global traction, governments grapple with effective regulation of this burgeoning industry. Nigeria’s harsh approach, involving detentions and accusations, reflects its fear of financial instability and illicit activities facilitated by crypto.
For Binance, Nigeria’s actions present significant operational challenges. The company must navigate a landscape where regulatory compliance is critical yet fraught with political and legal uncertainties. The situations involving Anjarwalla and Gambaryan underscore the risks of operating in regions with stringent regulatory environments.
