U.S. Senator Richard Blumenthal, Ranking Member of the Senate Permanent Subcommittee on Investigations, has formally requested internal documents from Binance regarding the platform’s alleged facilitation of transactions linked to Iranian entities and the reported dismissal of compliance personnel who investigated them.
The letter, sent on February 24, 2026, to Binance CEO Richard Teng, cites recent investigative reporting by The Wall Street Journal, The New York Times, and Fortune. It marks the latest layer of congressional scrutiny on the world’s largest cryptocurrency exchange, which previously pleaded guilty in 2023 to sanctions violations and anti-money laundering failures.
Reports Prompting the Inquiry
According to the publications, Binance compliance investigators identified approximately $1.7 billion in cryptocurrency transfers—primarily in Tether (USDT) on the Tron blockchain—from two accounts tied to Hong Kong-based entities Hexa Whale and Blessed Trust to Iranian-linked parties. These included wallets associated with Iran’s Islamic Revolutionary Guard Corps and groups such as the Yemeni Houthis, designated as terrorist organizations by the U.S.
The reports also referenced payments to crew members of Russia’s sanctions-evading “shadow fleet” of oil tankers. Internal documents allegedly showed that compliance staff flagged the activity, issued warnings, and recommended stronger controls, including enhanced KYC measures and bans on certain counterparties. Shortly afterward, at least four to five investigators involved in the probe were suspended, terminated, or otherwise left the company, per the sources cited in the media coverage.
Binance has consistently maintained that no staff were disciplined for raising legitimate compliance concerns and that the departures were unrelated to the investigations.
Specific Document Requests
Senator Blumenthal’s letter outlines a series of demands for records to be produced by March 6, 2026. The key categories include:
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All materials concerning the use of Binance by individuals or entities in Iran, or those conducting transactions with Iranian parties, including internal investigations, policy recommendations, and communications.
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Records related to the two flagged partners (Hexa Whale and Blessed Trust), such as VIP account decisions, registration details, and any assistance provided.
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Documentation on the use of Binance by parties linked to Russia’s shadow fleet and illicit oil trade.
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Records involving Tether and other stablecoins in connection with sanction evasion, money laundering, or support for designated terrorist organizations.
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All files pertaining to the suspension or dismissal of compliance staff and investigators who examined the Iranian and Russian activities.
The senator emphasized that the scale of the alleged transfers and the handling of internal warnings raise questions about Binance’s adherence to its 2023 settlement obligations.
Binance’s Response
In statements following the initial reports and the senator’s letter, Binance described the media coverage as inaccurate and, in the case of The Wall Street Journal, “false and defamatory.” The exchange stated that it detected and reported suspicious activity, viewing this as proof that its controls function effectively. Binance further noted a 97% reduction in sanctioned exposure since early 2024, supported by internal data and significant investments in compliance infrastructure.
The company indicated it plans to submit a detailed report on one of the referenced matters to the U.S. Department of Justice imminently.
Broader Context
This development occurs more than two years after Binance’s $4.3 billion settlement with U.S. authorities and the brief imprisonment of founder Changpeng Zhao, who received a presidential pardon in late 2025. The inquiry also references Binance’s reported business ties to entities linked to the Trump family, including World Liberty Financial.
For the cryptocurrency sector, the request underscores continued regulatory focus on sanctions compliance, especially as digital assets are increasingly used in jurisdictions facing international restrictions. Market participants are monitoring the outcome closely, as the subcommittee’s findings could influence future oversight and enforcement actions.
Disclaimer
This material is for informational purposes only and does not constitute financial, investment, or legal advice. Always conduct your own research (DYOR).