Nigerian officials proposed secret crypto settlement, claims Binance CEO

New details have emerged suggesting Nigerian officials tried to coerce Binance representatives into a secret settlement paid in cryptocurrency during meetings in early 2024.

Binance CEO Richard Teng issued a detailed account of Tigran Gambaryan’s ongoing detention on May7. Gambaryan is a former United States Internal Revenue Service agent who headed up Binance’s financial crime compliance team.

Teng condemned the Nigerian government for its actions, claiming the country has “set a dangerous new precedent for all companies worldwide” after detaining two of its employees.

Related: Arrested Binance exec pleads not guilty to charges in Nigeria

Gambaryan, who is a highly regarded figure in global financial crime prevention, was detained while on a business trip to Nigeria. Teng outlined the exchange’s efforts to engage constructively with Nigerian authorities, including participation in regulatory discussions and cooperation with law enforcement agencies.

Request for public hearing

According to Teng, Binance employees began discussions with Nigerian authorities during public investigative hearings following a request from the chairman of the House of Representatives Committee on Financial Crimes (HCFC).

The committee is reported to have highlighted issues related to Binance’s operations in Nigeria and outlined the lengths to which they were prepared to summon Binance, including issuing arrest warrants against the exchange’s team and CEO and preventing its delegation from leaving the country.

A public hearing was set for Jan. 10, and Binance was expected to respond to any allegations publicly in the presence of the petitioners, press and over 30 agencies.

Teng claimed that Binance had not received details of the allegations, and the delegation sought to submit responses in writing in the absence of a public hearing. The committee chair said it would consider the request and respond to Binance’s legal counsel.

Secret crypto settlement

Binance’s CEO alleges that unknown persons approached the exchange’s employees and suggested making a payment in settlement of the allegations. Teng said Binance’s local counsel was handed over terms from an agent representing the HCFC committee:

“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.”

The exchange declined the payment demand through its local legal representation and continued its engagement in the settlement negotiations. Binance put forward several demands following the incident as it prepared to continue discussions with Nigerian authorities.

Binance’s conditions to continue engaging in settlement negotiations following allegations of an off-record settlement proposal. Source: Binance

Subsequent meetings were scheduled for late February, with a number of government representatives in attendance from the Office of The National Security Adviser, the Office of the President, the Central Bank of Nigeria, the Nigerian Financial Intelligence Unit, the Economic and Financial Crimes Commission and the Nigerian SEC.

Related: Binance and its detained US exec face more charges in Nigeria

“Despite the clear risks, Tigran Gambaryan and Nadeem Anjarwalla (head of Binance Africa) received multiple assurances that they would be granted safe passage for their meetings,” Teng said.

Binance shuts down Nigerian services

The situation escalated when Nigerian officials demanded actions from Binance, including delisting the naira from their platform and providing detailed user information, resulting in the detention of Gambaryan and Anjarwalla.

Despite being given safety assurances, Binance asserts that the pair were held against their will, and their passports and mobile phones were confiscated. Gambaryan remains detained, with the Nigerian government insisting that his release is contingent on Binance’s compliance with its demands. 

Binance has responded by shutting down certain services in Nigeria, hoping to resolve the situation and secure Gambaryan’s release.

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