The Federal Government has initiated criminal proceedings against Binance, a prominent cryptocurrency exchange platform in a decisive move aimed at upholding fiscal responsibility and safeguarding the economic integrity of the country.
The charges, filed at the Federal High Court in Abuja, were announced on Monday by the Federal Inland Revenue Service (FIRS).
The lawsuit, designated as suit number FHC/ABJ/CR/115/2024, implicates Binance with a four-count tax evasion accusation.
Dare Adekanmbi,Special Adviser, Media to the Executive Chairman, FIRS in a statement disclosed that the second and third defendants in the suit are Tigran Gambaryan and Nadeem Anjarwalla, both senior executives of Binance currently supposed to be under the custody of the Economic and Financial Crimes Commission (EFCC).
Nadeem Anjarwalla, was earlier reported to have escaped from custody and fled the country. Online media platform Premium Times had reported that Anjarwalla escaped from the Abuja guest house where he and his colleague were being held on Friday after some guards on duty escorted him to a nearby mosque for prayers.
In a script like tale, the British national, who also holds Kenyan citizenship, is suspected to have departed Abuja onboard a Middle East airline.
The charges levied against Binance include non-payment of Value-Added Tax (VAT), Company Income Tax, failure to file tax returns, and complicity in aiding customers to evade taxes through its platform.
In the suit, the Federal Government also accused Binance of failure to register with FIRS for tax purposes and contravening existing tax regulations within the country.
One of the counts in the lawsuit pertains to Binance’s alleged failure to collect and remit various categories of taxes to the federation as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended.
Section 40 of the Act explicitly addresses the non-deduction and non-remittance of taxes, prescribing penalties and potential imprisonment for defaulting entities.
The charges further detail specific instances where Binance purportedly violated tax laws, such as failing to issue invoices for VAT purposes, thus obstructing the determination and payment of taxes by subscribers.
“Any company that transacts business in excess of N25 million annually is deemed by the Finance Act to be present in Nigeria.
“According to this rule, Binance falls into that category. So, it has to pay taxes like Company Income Tax (CIT) and also collect and pay Value Added Tax (VAT).
“But Binance did not do this properly. So, the company broke Nigerian laws and could be investigated and taken to court for this infraction,” Adekanmbi said.
The statement added that the Federal Government remains resolute in its commitment to ensuring compliance with tax regulations and combating financial impropriety within the cryptocurrency sector.
Binance pleaded guilty to flouting anti-money laundering laws in the United States in late 2023, settling for a plea bargain that cost the company $4.3billion.
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