Binance Sued by Victims of October 7 for Allegedly Facilitating Payments to Terrorist Group Hamas and Others

Victims of the October 7 attacks on Israel have sued crypto exchange Binance and its founder Changpeng Zhao, accusing them of facilitating millions of dollars in transactions for terrorist groups, including Hamas and Hezbollah. 

The lawsuit alleges Binance knowingly enables over $50 million in transactions for terrorist organisations following the October 7 attacks. 

Binance in Hot Water for Alleged Money Laundering

Binance and its founders, including Changpeng “CZ” Zhao, have been sued in the U.S. by victims of the October 7, 2023, attacks on Israel for allegedly facilitating millions in payments to terrorist organisations such as Hamas and Hezbollah. 

The suit is brought by 306 U.S. nationals (including the estates of those deceased) and their close family members who we “murdered, maimed, taken hostage, or otherwise injured in the acts of terrorism perpetrated by Hamas, Iran’s Islamic Revolutionary Guard Corps (“IRGC”), Hezbollah, and Palestinian Islamic Jihad (“PIJ”) in the State of Israel on October 7, 2023 (“October 7” or “October 7 Attacks”) and in various terrorist attacks that these terrorist organizations perpetrated following October 7.”  

Filed on Novermber 24 in the U.S. District Court in North Dokota, the lawsuit claims that the world’s largest crypto exchange facilitated transfers for Hamas, Hezbollah, IRGC, and the PIJ, who committed October 7 atrocities in Israel, and “various terrorist attacks” thereafter. According to the suit, the plaintiffs allege that Binance moved over $1 billion through its platform, including over $50 million after October 7. 

The defendants names in the lawsuit are Binance Holdings, Changpeng Zhao, and Guangying “Heina” Chen. Plaintiffs are seeking damages under the Anti-Terrorism Act from the exchange, its founder and former CEO CZ, and Chen, Binance’s co-founder and de facto CFO. 

Defendants Willingly Assisted Terror Groups for Years

According to the plaintiffs, the defendants “knowingly, wilfully, and systematically assisted” Hamas, Hezbollah, IRGC, and the PIJ, and other terrorist groups by helping them “transfer and conceal the equivalent of hundreds of millions of U.S. dollars through the Binance platform in support of their terrorist activities.”

The lawsuit states that the defendant’s assistance “directly and materially” contributed to the October 7 attacks and subsequent acts of terrorism. 

The suit further alleges that Binance intentionally “structured itself as a refuge for illicit activity” and knowingly served accounts connected to terrorist organisations – a claim plaintiffs say is supported by extensive evidence revealed through U.S. enforcement actions. 

These accusations come after Binance pleaded guilty in November 2023 and paid a $4.32 billion criminal fine for violating federal anti-money laundering and sanctions laws. Changpeng “CZ” Zhao also pled guilty to federal charges related to Binance’s regulatory failures, served four months in prison and paid a $50 million fine. After completing his sentence, Zhao was pardoned by President Donald Trump.

The plaintiffs allege that Zhao and Chen, intentionally designed Binance “as a criminal enterprise to facilitate money laundering on a global scale.” 

The lawsuit also states:

Relief Sought

In their claim for relief, the plaintiffs asserted that the defendants knowingly provided substantial assistance to Hamas and the other terrorist groups by:

• Transferring significant amounts of crypto and fiat to the groups and their agents.
• Maintaining wallets on the exchange for the benefit of the terrorist groups and their front organisations.
• Providing the groups with access to U.S. dollar-denominated liquidity and the U.S. banking system.
• Concealing fiat and crypto transfers conducted by or for the benefit of the groups.
• Enabling terrorist organisation to access and transfer assets that could reasonably be used to carry out attacks.

The suit further alleges that Binance continued providing services even after senior executives became aware that the exchange was servicing Hamas, Hezbollah, the IRGC, and PIJ and their financial backers - despite these groups being designated terrorist organisations under U.S. law. 

The plaintiffs are seeking compensatory and treble damages under 18 U.S. Code § 2333, which allows U.S. nationals or their estates and heirs injured by international terrorism to recover three times the damages sustained. 

According to Reuters, in a statement, Binance declined to discuss the complaints but stated “we comply fully with internationally recognized sanctions laws.” 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice