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Nigeria has charged Binance and two of its executives with tax evasion, including one that escaped custody, escalating the legal stand-off between the African nation and the world’s largest cryptocurrency exchange.
Tax authorities alleged that Binance, which is unregulated in Nigeria, has not filed tax returns nor paid value added or corporation tax, according to a statement by the country’s Federal Inland Revenue Service.
The charges, which were filed on Friday, mark the latest twist in Binance’s protracted dispute with the Nigerian authorities as the government seeks to head off its worst economic crisis in three decades and restore its citizens’ faith in its battered currency.
Cryptocurrency exchange sites have become alternative marketplaces to set an unofficial price for the naira, and Binance is the most used in the country. Nigeria has also held two Binance executives for four weeks following a clampdown on crypto exchanges in February.
FIRS said Binance had helped its Nigeria-based users evade paying taxes. Binance did not respond to a request for comment relating to the accusation of tax evasion.
As the crackdown was stepped up last month, the two senior Binance executives who had flown into the country to discuss the situation were then detained. The men, Nadeem Anjarwalla, a UK citizen, and Tigran Gambaryan, a US citizen, had their passports seized.
A spokesperson for the family of Anjarwalla told the Financial Times he had left custody on Saturday and left Nigeria “by lawful means”.
In the early stages of negotiations following the executives’ arrest, the office of Nigeria’s national security adviser asked Binance to resolve outstanding tax liabilities, according to documents seen by the Financial Times.
Nigeria has requested that Binance provide information on its top 100 users in the country and all transaction history for the past six months.
The NSA confirmed on Monday that Anjarwalla had escaped on Friday and said he was using a “smuggled” passport. “Security agencies are working with Interpol for an international arrest warrant on the suspect,” the office said.
“The personnel responsible for the custody of the suspect have been arrested, and a thorough investigation is ongoing to unravel the circumstances that led to his escape from lawful detention,” it added.
A source familiar with the matter said Anjarwalla, who is also a Kenyan citizen, may have travelled using his Kenyan passport.
“We were made aware that Nadeem is no longer in Nigerian custody,” Binance told the FT. “Our primary focus remains on the safety of our employees and we are working collaboratively with Nigerian authorities to quickly resolve this issue,” they added.
The NSA said it would launch an investigation into Anjarwalla’s escape.
“The federal government of Nigeria, like other governments around the world, has been investigating money laundering and terrorism financing transactions perpetrated on the Binance currency exchange platform,” it added.
The two executives were due to remain in detention until April 4, when a court hearing into their future is scheduled to take place. Both men were initially held under a court order that permitted their detention for a period of 14 days that ended on March 12.