George Miller
The US Department of Justice (DOJ) has initiated a civil forfeiture process to claim $16 million in cryptocurrency from a Binance account after a lengthy investigation. The digital currencies in question are believed to be associated with alleged bribery linked to former FTX CEO, Sam Bankman-Fried.
According to a court filing, the Binance account, established in November 2023, held multiple tokens including Internet Computer (ICP), Avalanche (AVAX), Ripple (XRP), Cardano (ADA), and Solana (SOL). Notably, Solana constituted the bulk of the account’s worth, which was approximately $8.5 million at that time. Due to the recent rise in the cryptocurrency market, the total value has escalated to almost $16 million.
This investigation traces back to November 2021, when Bankman-Fried allegedly transferred 40 million USDT from an Alameda Research wallet as part of a bribe to Chinese officials to ‘unfreeze’ $1 billion in assets held on two Chinese exchanges. Investigators followed the money through various wallets, eventually linking it to the Binance account between late 2021 and 2023.
Unusual activities were detected in the Binance account, such as rapid deposits of stablecoins and Bitcoin that were soon converted into different cryptocurrencies via over-the-counter trades. These red flags prompted the DOJ’s move to seize the assets. Meanwhile, FTX, the now-bankrupt firm, has been in the headlines again as it seeks to sue various companies to reclaim funds for its creditors. A report from November 11 indicated that FTX had filed a lawsuit against Binance and its CEO, CZ, aiming to recover about $1.8 billion, claiming that these assets were fraudulently transferred by Bankman-Fried in a 2021 share buyback agreement.
With the asset values having more than doubled, law enforcement might encounter further difficulties in recovering these funds.