Binance establishes board of directors for the first time amid legal issues: details


Recent years have not been smooth sailing for Binance, which has repeatedly found itself embroiled in legal issues. Firstly, Binance Holdings has established a board of directors consisting of seven members – who will assist CEO Richard Teng in making decision-making and considering business-related proposals for the company. The decision comes after the exchange recently received a summons from Nigerian authorities on suspicion of the exchange's involvement in facilitating illegal activities.

This is the first time in the seven years since Binance was founded that the company has formed a board of directors. Gabriel Abed, Ambassador of Barbados to the UAE, has been appointed Chairman of the Board of Directors of Binance. An official blog post revealed that co-founder Hana Chen is also part of the board along with CEO Teng of the company.

“This significant change in leadership is seen as a central shift at Binance under the stewardship of CEO Richard Teng, appointed in November following Binance's settlement with US authorities. Since its founding in China in 2017, Binance has claimed to operate without a global headquarters. “However, Teng has indicated a desire to implement a more traditional corporate structure, including defining its headquarters and effective board of directors,” Binance’s post said.

Given the company's ongoing legal entanglements, it seems only natural that the company has decided to bring in more industry experts to run its operations.

Last year, Binance was investigated by the US Securities and Exchange Commission (SEC) for violating US trading-related laws. In November 2023, the exchange's founder, Changpeng Zhao, pleaded guilty to failing to maintain an effective anti-money laundering program at the company.

Soon after, Zhao resigned as CEO of the company and Binance paid a settlement amount of $4.3 billion (roughly Rs. 35,855 crores) as a fine to the US Department of Justice, Treasury Department, and the Commodity Futures Trading Commission.

After Zhao stepped down, Teng was named the new CEO of the exchange. However, even under Teng's leadership, Binance's legal issues appear to be no closer to being resolved.

Earlier this month, Nigeria's House of Representatives Committee on Financial Crimes reportedly summoned Binance CEO Teng over suspicions of the exchange's possible involvement in money laundering and terror financing. Although the details of Teng's arrival in Nigeria for this meeting are unknown, a Binance executive in the custody of Nigerian authorities reportedly escaped and fled abroad, leaving the company in an awkward situation.

Binance's intentions to become the most licensed crypto exchange in the world have also been hit after the Philippines announced a ban on the exchange citing the lack of an official operating license.

Since 2022, Binance has been assembling a solid team of lawyers to help it deal with legal hurdles.

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