Story highlights
- Binance CEO Richard Teng revealed in a blog post that unknown individuals demanded cryptocurrency bribes from Binance executives prior to their detention by Nigerian authorities, despite meetings intended to resolve regulatory concerns with around 30 Nigerian agencies.
- Following these interactions and a subsequent refusal to pay the bribes, Binance executives were detained by Nigerian officials from the Office of the National Security Adviser, leading Binance to suspend certain trading activities in response to the incident.
- Concurrently, Binance faces legal challenges from the Federal Inland Revenue Service (FIRS) for alleged tax evasion, including the failure to remit various taxes, complicating their operational status in Nigeria.
Chief Executive Officer (CEO) of Binance, the world’s largest cryptocurrency trading platform, Richard Teng, has claimed that some unknown persons sought a bribe of cryptocurrency from its executives, Tigran Gambaryan and Nadeem Anjarwalla, before their detention on February 28, 2024.
Teng made the claim in a blog post on Monday, detailing how the Binance executives tried to engage with Nigerian authorities, including a January 8 meeting in Abuja, before they were accused of criminal acts.
He said the meeting was set up with the Nigeria government through a committee consisting of about “30 agencies.” He noted that the committee emphasized the serious nature of the meeting and their readiness to issue arrest warrants and restrict travel for Binance’s team.
However, it was discovered that the committee lacks the actual authority to issue arrest warrants. The meeting was later postponed to January 11, 2024, Teng said.
The CEO stated that on the same day, January 8, some unknown persons approached their employees seeking bribes in cryptocurrency to “make the issues go away”.
“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.
Meeting with ONSA
Following the incident, the Binance CEO said their executives were then invited to meet with the Office of the National Security Adviser (ONSA), a move Binance believed would help resolve the issues diplomatically.
Meanwhile, Teng said the meeting was supposed to be a diplomatic effort to resolve issues, noting that the Nigerian government gave “multiple assurances that they would be granted safe passage for their meetings.”
Teng said the meeting was scheduled for “February 26, 2024, at 2 pm at ONSA’s offices in Abuja.”
“In their first meeting, they met with leaders from ONSA, the office of the President, the Central Bank, NFIU, EFCC, and the SEC.”
He said after the meeting, the executives, Gambaryan and Anjarwalla, were told to wait outside shortly, only to be summoned back by the officials two hours later.
“After waiting more than two hours, the Binance employees were invited back into a meeting room albeit with different attendees than the ones announced — specifically, there were four members of the Economic and Financial Crimes Commission (EFCC).
“The leader of the group took on a hostile approach. He said that the issues involving Binance were of national security,” he wrote.
According to him, this led to the arrest and detention of the two executives.
Recommended reading: FIRS files tax evasion charges against Binance, as Executives escape Nigeria
Backstory
On February 28, Nairametrics reported that Nigeria officials detained two senior Binance executives.
- Nadeem Anjarwalla, a 37-year-old British-Kenyan who serves as the regional manager for Africa, and Tigran Gambaryan, a 39-year-old American in charge of financial crime compliance at Binance.
- The executives visited Nigeria in response to the country’s recent crackdown on various cryptocurrency trading platforms.
- During their stay, they were apprehended by the ONSA and their passports were confiscated.
In response to the detention of its executives, Binance discontinued the trading of the naira against bitcoin and tether cryptocurrencies on its exchange.
Escape from lawful custody
Meanwhile, on March 24, a statement from ONSA confirmed that one of the executives, Anjarwalla, subsequently escaped from lawful custody.
- The Briton, who also has Kenyan citizenship, is believed to have flown out of Abuja using a Middle East airliner.
- It remains unclear how Mr Anjarwalla got on an international flight despite his British passport, with which he entered Nigeria, remaining in the custody of the Nigerian authorities.
However, the Federal Government said it is discussing with Interpol to secure an international arrest warrant for Anjarwalla and extradite him to Nigeria.
FIRS charge against Binance
The Federal Inland Revenue Service (FIRS) in Abuja has filed legal proceedings against the cryptocurrency exchange, Binance, alleging four instances of tax evasion.
The allegation against Binance involves the non-remittance of value added tax (VAT), company income tax (CIT), non-compliance with tax return filing obligations, and facilitating tax evasion for its users.
Furthermore, in the lawsuit, the Federal Government charged Binance with not registering for tax purposes with the FIRS and violating the country’s tax laws.
According to the FIRS, “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.”
All parties involved have pleaded not guilty to all charges, as the case is adjourned till May 17 by the Federal High Court in Abuja.
Recommended reading: Binance CEO: Nigerians officials asked for bribe in crypto to free detained executives
