Senator Lummis alleges Binance, Tether connected to illicit financing tied to Israel-Hamas conflict

• Binance, Tether could face criminal charges as Senator Cynthia Lummis alleges illicit financing following Hamas' attack on Israel.
• Wyoming Senator Cynthia Lummis wants the US DOJ to levy criminal charges against Binance and Tether as unregulated crypto entities.
• According to Lummis, the firms have facilitated illicit financing activity since 2021.
• Lummis wants a clear distinguishment between crypto-asset intermediaries on metrics of compliance and social responsibility.

Binance exchange and Tether could be facing criminal charges following a move by Wyoming Senator Cynthia Lummis to ask the US Department of Justice (DOJ) to levy charges against the two entities. Notably, at some point, the DOJ considered charging Binance on fraud charges but resorted to a less volatile move because of the potential market implication.

Also Read: US DOJ deliberates fraud charges against Binance, but concerns of implications to customers weigh over

Binance, Tether at risk of criminal charges

Binance could be the subject of a new probe by the US DOJ, alongside Tether, after the recent allegation involving fraud. It comes after Senator Lummis asked the DOJ to look into the two firms with criminal charges in mind for facilitating illicit financing for the past two years.

Based on the politician’s claims, the entities have also been involved in aiding the Hamas group in their “malevolent attack on Israel.” With this, the Senator urges the justice department to levy charges against the largest cryptocurrency exchange by trading volume.

Nevertheless, the senator defends the role of crypto assets and distributed ledger in driving responsible innovation  in the US financial markets, underscoring the need to chaff out the irresponsible behavior in the industry and calling out individual projects for their negative activities instead of vilifying the entire ecosystem.

WSJ on Hamas and Israel

The news comes days after a report on the WSJ indicated that Hamas, Palestinian Islamic, Jihad, and Hezbollah have received funding in crypto multiple times over the last two years. Binance is purportedly the subject of another DOJ probe.

On October 16, a report in the Financial Times indicated that Israeli law enforcement authorities had ordered the closure of 100 Binance accounts linked to Hamas right from the moment hostility started on October 7. It followed another report in May, where Israeli law enforcement had seized more than 190 Binance accounts linked to   Islamic terrorism between 2021 and 2023.

Based on Lummis’ letter, the fact that Binance had allowed Hamas and other terrorist groups to open accounts and conduct business even after the public reported the issue is a clear indication that the exchange could be offering material support to criminal organizations under Federal law. 

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