Nigerian authorities continued their pursuit of Tigran Gambaryan on July 5. The Binance executive has been in custody under the Economic and Financial Crimes Commission (EFCC) since February.
What started as concerns over currency manipulation has grown into a significant legal showdown involving Binance, the world’s largest cryptocurrency exchange, and Nigerian regulators.
Commencement of Troubles
On February 20, Binance’s Nigerian users encountered difficulties trading Tether (USDT) for the Nigerian naira on its peer-to-peer (P2P) platform, marking the onset of more serious challenges. In response, Binance restricted USDT purchases using naira, disabled the “Buy” option, and fixed a rate of 1,802 naira per US dollar, citing fraud prevention measures.
Following this, Nigerian authorities blocked access to major crypto exchanges, including Binance, citing concerns over currency manipulation and money laundering, which Binance confirmed.
As a result, Binance officials Nadeem Anjarwalla and Gambaryan were detained in Abuja, Nigeria’s capital, amid an investigation by the Office of the National Security Adviser.
Changes and Legal Developments
By March 5, Binance halted all Nigerian naira services, suspending deposits, withdrawals, and delisting naira trading pairs. Users were given a three-day period to withdraw or convert their naira balances to USDT.
On March 18, the EFCC obtained a court order requiring Binance to disclose information about its Nigerian users, citing concerns related to money laundering and terrorism financing. An inter-agency committee also implicated forex manipulation in the depreciation of the naira.
Escape and Legal Proceedings
Nadeem Anjarwalla escaped custody on March 19 using his Kenyan passport during Ramadan prayers, while the Federal Inland Revenue Service (FIRS) initiated criminal proceedings against Binance for alleged tax noncompliance.
On April 8, the EFCC brought additional charges against Gambaryan totaling $34 million for money laundering, currency speculation, and tax evasion. Gambaryan’s plea to dissociate himself from representing Binance in court was rejected, leading to his transfer to the Kuje Correctional Center.
Despite Binance’s cooperation, CEO Richard Teng expressed dismay on May 7 over Gambaryan’s prolonged detention and allegations that an unnamed Nigerian official demanded a $150 million crypto payment, which Binance interpreted as a bribe. The Nigerian Ministry of Information’s spokesperson, Rabiu Ibrahim, dismissed these bribery claims as false and diversionary.
Escalation and International Response
On June 4, twelve US lawmakers urged President Joe Biden to secure Gambaryan’s release, alleging baseless charges aimed at pressuring Binance. Nigeria’s Minister of Information defended the legal process, noting Binance’s substantial earnings from its Nigerian operations.
Industry Concerns
By June 14, the FIRS dropped charges against Gambaryan and Anjarwalla, focusing solely on Binance through its local representative and relieving Gambaryan from future court appearances.
The Blockchain Industry Coordinating Committee of Nigeria (BICCoN) warned about the adverse impact of the legal dispute on Nigeria’s blockchain sector and advocated for a fair trial to restore investor confidence.
On July 2, Judge Emeka Nwite ordered the Kuje Correctional Center to release Gambaryan’s medical records due to health concerns. Despite being a US citizen, Gambaryan received limited medical attention despite a prolonged illness.
Court proceedings in the EFCC’s case against Binance and Gambaryan adjourned until July 5 after the completion of the first witness examination.
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