European and US investigators say Binance's April 2025 policy change slows cooperation, making it harder to freeze stolen crypto funds. NYT reports the exchange routes requests through UAE treaty channels.
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Binance in April 2025 adopted a policy that routes foreign law enforcement requests through the United Arab Emirates government and formal treaty channels instead of answering them directly, The New York Times reported Tuesday. Investigators from five European countries described difficulty obtaining information from the exchange except in cases involving child sexual abuse material or terrorism, the Times cited from a law enforcement conference in the Netherlands. Most other requests are directed through Abu Dhabi, where Binance’s regulated entities fall under Abu Dhabi Global Market rules, or must travel through Mutual Legal Assistance Treaties, the government-to-government process for exchanging evidence in criminal cases.
Speed decides outcomes in crypto investigations. Illicit funds can be bridged and swapped within seconds, making fast cooperation critical. The Times report follows an account this month from The Information, which cited a Justice Department memo warning federal prosecutors in crypto cases to expect less help from Binance on freezing and seizing assets.
Binance agreed to a $4.3 billion penalty in November 2023 to resolve DOJ money laundering and sanctions charges. Founder Changpeng Zhao pleaded guilty to a Bank Secrecy Act violation, and the company accepted years of independent monitoring. In May, The Information reported that the Treasury Department had privately pressed the exchange to comply with that monitoring program after reports of roughly $1 billion in Iran-linked flows. The Wall Street Journal and Fortune reported earlier this year that Binance had dismissed compliance staff who investigated transactions allegedly tied to Iran, allegations the exchange denied.
The policy change, first flagged at the Netherlands conference, adds a layer of friction that investigators say benefits fraudsters and sanctions evaders. The Justice Department memo, described by The Information, acknowledged the shift and advised prosecutors to plan for slower asset freezes. No public response from Binance to the Times report was included in the article.
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