Legal troubles continue for Binance, after Nigeria said it was suing the crypto exchange for billions of dollars.
Reuters, citing court documents, reported that Nigeria has filed a lawsuit seeking to compel Binance to pay $79.5bn for economic losses the country’s government alleges were caused by the cryptocurrency exchange’s operations there, as well as $2bn in back taxes.
In 2023 Binance had issued a cease and desist notice to a company called “Binance Nigeria Limited”, which former Binance CEO Changpeng Zhao called a “scammer entity”. Zhao said at the time that the Nigerian entity was not affiliated with Binance.
It came after the Nigerian SEC financial regulator had ordered Binance to halt its operations in the country, saying “Binance Nigeria Limited” was not registered or regulated, and was therefore illegal.
Nigerian woes
Binance was also separately accused of tax evasion in the country, after crypto websites emerged as platforms of choice for trading the local naira currency.
Nigeria accused the digital platform – where investors can buy, sell and trade cryptocurrencies – of fixing exchange rates and currency speculation leading to the free-fall of the local currency.
This led to Nigeria in 2024 detaining two Binance executives.
Tigran Gambaryan was in charge of financial crime compliance at Binance, while Nadeem Anjarwalla was the regional manager for Africa. Both men were charged with profiting from money-laundering involving more than $35m.
However Anjarwalla escaped from custody on 22 March 2024 and fled the country.
In October 2024 Nigeria’s anti-corruption agency dropped a money-laundering case against Tigran Gambaryan to allow him to get medical treatment abroad.
Nigerian lawsuit
Now Reuters has reported that Binance, which is not registered in Nigeria, did not immediately respond to a request for comment about the lawsuit from Nigeria.
However the crypto exchange has previously said it is working with Nigeria’s Federal Inland Revenue Service (FIRS) to resolve potential historic tax liabilities.
The inland revenue service alleges that Binance has a “significant economic presence” in Nigeria and is therefore liable for corporate income tax. It is seeking a court declaration that Binance pay income taxes for 2022 and 2023, plus a 10 percent annual penalty on unpaid amounts.
FIRS is also requesting a 26.75 percent interest rate on the unpaid taxes, based on the Central Bank of Nigeria’s lending rate, Reuters reported.
Binance was already facing four counts of tax evasion in Nigeria after a government crackdown on the industry in 2024, Reuters noted. The charges include non-payment of value-added tax, company income tax, failure to file tax returns and complicity in helping customers to evade taxes through its platform.
Binance meanwhile is reportedly contesting the charges, and had announced in March 2024 that it was stopping all transactions and trading in the naira.
The company is also facing separate anti-graft agency money laundering charges, which it has denied.