At a hearing in the US District Court for the Southern District of New York, Binance sought to dismiss a lawsuit filed by victims affected by the Hamas attack on Israel.
The lawsuit was filed in 2024 by Judith Raanan, a survivor of the Hamas hostage-taking during the 2023 attacks. The victims accused the crypto exchange of playing a role in facilitating the violence
Binance Challenges Claims of Aiding Hamas in Court
During the hearing on January 30, Binance’s legal team argued that the claims should be dismissed. They pointed out that there was no direct relationship between Hamas and the exchange.
“There was no special relationship between Hamas and Binance,” the lawyers argued.
The 2024 lawsuit alleges that Binance played a role in facilitating terrorism by aiding Hamas and other organizations linked to violence.
Binance, along with former CEO Changpeng Zhao (CZ), faces accusations of non-feasance. They failed to prevent money laundering and did not file Suspicious Activity Reports (SARs). These failures allegedly enabled Hamas to use the platform for financial transactions.
Binance lawyers highlighted during the court hearing that crypto is not “inherently dangerous.” The defense then downplayed allegations that CZ had admitted to assisting terrorism in a plea agreement, arguing that the comments related to keeping US users on the platform. The lawyers added that it was not an admission of guilt in aiding terrorist activities.
However, US District Judge John G. Koeltl appeared unconvinced by Binance’s defense. He emphasized that secondary liability for aiding and abetting terrorism is challenging to dismiss outright.
He also noted the gravity of the position that Binance could take – one where it accepts terrorist accounts and treats them like any other user.
The lawsuit accuses Binance of enabling the transfer of funds to Hamas, despite being aware of the group’s activities on the platform.
“Binance was told, Hamas is on your platform. They didn’t seize their funds, they helped them leave and told them they were flagged, facilitating,” the lawyer for the plaintiffs said.
Judge Koeltl indicated that he would rule on the motion to dismiss at a later date, leaving the case in legal limbo for now.
Nevertheless, it appears Binance’s legal troubles are never-ending. A Spanish court recently opened an investigation into Binance for alleged misappropriation of funds in 2021. Moreover, French authorities have also launched an investigation into Binance. The exchange is accused of money laundering, tax fraud, and drug trafficking.
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