The global cryptocurrency exchange Binance has found itself embroiled in a legal battle with Nigerian authorities, as one of its executives, Nadeem Anjarwalla, has escaped custody amid accusations of money laundering and tax evasion.
The incident has escalated tensions between the West African nation and the world’s largest cryptocurrency exchange, as Nigeria seeks to crack down on the use of digital assets for illicit activities.
TLDR
- Nadeem Anjarwalla, a Binance executive detained in Nigeria amid a crypto crackdown, has escaped custody using a smuggled passport.
- Anjarwalla, who holds dual British and Kenyan citizenship, was detained along with his American colleague, Tigran Gambaryan, on February 26 following a crackdown on the crypto platform.
- Nigeria has accused Binance of being used for money laundering and terrorism financing, although no evidence has been provided publicly.
- Nigeria’s tax agency has filed a four-count charge on tax evasion against Binance, accusing the exchange of aiding customers in evading taxes through its platform.
- The Nigerian authorities have requested Binance to provide information on its top 100 users in the country and all transaction history for the past six months.
Anjarwalla, who serves as Binance’s regional manager for Africa, was detained along with his American colleague, Tigran Gambaryan, on February 26 when they arrived in Nigeria following a crackdown on the crypto platform.
The two executives were held under a court order permitting their detention for 14 days, which ended on March 12.
However, Anjarwalla managed to escape custody on Friday, March 24, using a smuggled passport, according to Nigeria’s National Security Adviser’s office.
The circumstances surrounding Anjarwalla’s escape remain unclear, with the Premium Times newspaper reporting that he fled from a guest house in the capital city, Abuja, after guards allowed him entry to a nearby mosque for prayers.
The Nigerian authorities have arrested the personnel responsible for the suspect’s custody and have launched an investigation into the incident. The National Security Adviser’s office has also stated that security agencies are working with Interpol to issue an international arrest warrant for Anjarwalla.
Nigeria, which is Africa’s largest crypto economy in terms of trade volume, has accused Binance of being used for money laundering and terrorism financing, although no evidence has been provided publicly to support these claims. In early March, Binance stopped all trading with the Nigerian naira currency on its platform following the accusations.
In addition to the money laundering allegations, Nigeria’s tax agency has filed a four-count charge on tax evasion against Binance. The Federal Inland Revenue Service (FIRS) has accused the crypto exchange of failing to file tax returns and pay value-added tax (VAT) and corporation tax.
The agency also alleges that Binance has been complicit in aiding customers to evade taxes through its platform, citing specific instances where the exchange purportedly violated tax laws.
As part of the ongoing investigation, the Nigerian authorities have requested that Binance provide information on its top 100 users in the country and all transaction history for the past six months. This request has raised concerns among cryptocurrency enthusiasts and privacy advocates, who fear that the government’s actions may set a dangerous precedent for the regulation of digital assets in the country.
The legal stand-off between Binance and the Nigerian government comes at a time when the country is grappling with its worst economic crisis in three decades.
Many Nigerians have turned to cryptocurrencies as a means to hedge against surging inflation and the declining value of the local currency. Cryptocurrency exchange sites, with Binance being the most popular, have become alternative marketplaces for setting an unofficial price for the naira.
