Richard Teng, the Chief Executive Officer of Binance, the world’s largest digital asset exchange platform, has launched a scathing critique against Nigerian authorities over the prolonged detention of two of its top executives.
The detention, according to Teng, not only poses a grave threat to Binance’s operations but also establishes a chilling precedent for companies worldwide.
In an exclusive interview with Reuters on Tuesday, Teng pulled no punches as he condemned the ongoing confinement of Tigran Gambaryan, Binance’s head of financial crime compliance, and his colleague Nadeem Anjarwalla. Both executives have found themselves trapped in a legal tussle in Nigeria, facing charges of tax evasion and money laundering – allegations vehemently disputed by the company.
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“To invite a company’s mid-level employees for collaborative policy meetings, only to detain them, has set a dangerous new precedent for all companies worldwide,” Teng said.
Teng provided a detailed account of the events leading up to the executives’ detention, shedding light on the company’s efforts to engage constructively with Nigerian authorities. Meetings held as early as January 2024 aimed at fostering collaboration were abruptly disrupted when Nigerian officials demanded the delisting of the country’s currency, the naira, from Binance’s platform, alongside intrusive demands for user data.
The CEO expressed profound dismay over the protracted detention of Gambaryan, lamenting what he termed as “dubious grounds” for his continued confinement. Despite diplomatic overtures and assurances of cooperation, Nigerian authorities have yet to relent, leaving Binance in a state of limbo.
However, the plot thickened with Teng’s revelation in a recent blog post, wherein he disclosed attempts at bribery directed at Binance executives before their detention. The CEO recounted a brazen encounter following a meeting with Nigerian officials on January 8, during which unidentified individuals purportedly offered to absolve the company of allegations in exchange for a substantial sum in cryptocurrency – a proposition summarily rejected by Binance.
“As our employees were leaving the venue, they were approached by unknown persons who suggested to them to make a payment in settlement of the allegations.
“Later that day, our local counsel — representing us at that time — was summoned by the committee through someone purporting to be their agent, who relayed the committee’s terms and instructed our local counsel to advise us.
“Counsel reported back that he had been presented with a demand for a significant payment in cryptocurrency to be paid in secret within 48 hours to make these issues go away and that our decision was expected by the morning.
“Our team grew increasingly concerned about their safety in Nigeria and immediately departed. We, of course, declined the payment demand via our counsel, not viewing it to be a legitimate settlement offer,” Teng said.
Binance’s ordeal is part of a broader crackdown on the crypto industry by the Nigerian government.
How we got here – the Backstory
The unfolding drama surrounding the detention of two senior Binance executives, Nadeem Anjarwalla and Tigran Gambaryan, by Nigerian officials, has thrust the global cryptocurrency community into a whirlwind of speculation and intrigue. What began as a routine visit to Nigeria in February, in response to the country’s heightened scrutiny of cryptocurrency trading platforms escalated into a complex legal battle fraught with diplomatic tensions and allegations of impropriety.
In response to the detention, Binance took decisive action, discontinuing the trading of the Nigerian naira against popular cryptocurrencies like bitcoin and tether on its platform.
However, the plot thickened with the revelation on March 24 that Anjarwalla had managed to escape from lawful custody, throwing Nigerian authorities into disarray. The British-Kenyan executive, reportedly utilizing a Middle East airliner, fled Abuja despite his British passport remaining in Nigerian custody. The audacious escape prompted swift condemnation from the Nigerian government, which vowed to pursue international avenues, including cooperation with Interpol, to secure Anjarwalla’s extradition.
Amidst the escalating tensions, the Federal Inland Revenue Service (FIRS) in Abuja escalated the legal battle by filing proceedings against Binance, alleging four instances of tax evasion. The FIRS accused the cryptocurrency exchange of failing to remit Value Added Tax (VAT) and Company Income Tax (CIT), neglecting tax return filing obligations, and facilitating tax evasion among its users. The lawsuit also highlighted Binance’s purported failure to register for tax purposes and its alleged violations of Nigerian tax laws.
The gravity of the situation became further apparent as the Federal High Court adjourned the case against Binance and its executives to May 17. The charges, ranging from money laundering to tax evasion, underscored the multifaceted legal challenges confronting Binance in Nigeria. Allegations of manipulation of the local currency by peer-to-peer traders on the platform only added to the complexity of the case.
Throughout the legal proceedings, Binance and its team of executives have maintained their innocence, vehemently denying any wrongdoing. With both sides digging in their heels, the stage is set for a protracted legal battle that could have far-reaching implications for the Nigerian cryptocurrency industry.