By Christian George
One of world’s most crypto currency exchanger, Binance, was alleged to have secretly transferred $400 million from a US partner’s account to a trading firm managed by its CEO, Changpeng Zhao.
According to Reuters, banking records revealed that Binance moved large sums from US partner to trading firm, Merit Peak.
Bank records have Merit Peak document named Binance CEO Zhao as manager.
A Binance executive is alleged to have had access to US partner’s account at Silvergate Bank, messages showed.
Over the first three months of 2021, more than $400 million flowed from the Binance.US account at California-based Silvergate Bank to this trading firm, Merit Peak Ltd.
According to records for the quarter, which were reviewed by Reuters, the Binance.US account was registered under the name of BAM Trading, the US exchange’s operating company. Company messages show the transfers to Merit Peak began in late 2020.
It is yet to be ascertained if the money belonged to any of its US customers.
The exchange’s public terms of use at the time said its customers’ dollar deposits were held at Silvergate and a Nevada-based custodian firm called Prime Trust LLC. Prime Trust made $650 million in wire transfer deposits into the Binance.US account during the quarter, the bank records show.
In a statement, Binance.US spokesperson, Kimberly Soward, maintained that Merit Peak “is neither trading nor providing any kind of services on the Binance.US platform” and “only Binance.US employees have access” to the bank accounts of the US company.
However, the transfer had raised much concerns and CEO of Binance.US at the time, Catherine Coley, wrote to a Binance finance executive in late 2020 asking for an explanation for the transfers, calling them “unexpected” and saying “no one mentioned them.”