Interpol’s Red Notice allegedly seeking the arrest of Binance’s founder has been refuted by Binance CEO, who calls the rumor “FUD.”
Changpeng “CZ” Zhao denied receiving a Red Notice request from the International Criminal Police Organization in a tweet he posted on Tuesday. He even shared a photo of the alleged Red Notice, clarifying that it was faked.
Tweeter ‘Cobie’ spread the rumors after tweeting a crypto transaction accompanied by an Interpol Red Notice claiming that CZ was under investigation.
The story was picked up by several news outlets, causing panic among the crypto community. BNB’s price, as well as the market’s, dropped sharply.
Interpol is an international criminal police organization that promotes cross-border cooperation among law enforcement agencies from various countries. It issues a Red Notice to wanted fugitives for extradition.
The agency can serve as a request to law enforcement agencies in 194 member countries to locate and arrest the person named in the notice.
A Red Notice is not the same as an international arrest warrant and cannot be enforced on its own. Rather, the notice is used to facilitate the extradition of a wanted person from one country to another.
A representative for Binance refuted the claims and pointed to Interpol’s website, which as of April 4 did not show a public Red Notice for Binance CEO Changpeng Zhao.
Binance in a Pickle With US Regulators
Binance has come under increased scrutiny from regulators around the world in recent months, with its US operations particularly vulnerable to ongoing Securities and Exchange Commission crackdowns (SEC).
The CFTC recently announced that it is suing Binance and its founder, Changpeng “CZ” Zhao, on allegations that the cryptocurrency exchange knowingly offered unregistered crypto derivative products in the United States, in violation of the law.
The world’s largest cryptocurrency exchange is also being investigated by the US Internal Revenue Service and various federal prosecutors for alleged violations of anti-money laundering (AML) and know-your-customer (KYC) controls.
Furthermore, the SEC issued a Wells Notice to Paxos, a cryptocurrency firm that issues Binance’s stablecoin Binance USD (BUSD), indicating that it intends to sue the company over its BUSD issuance. The agency claimed that BUSD is an unregistered security.
Three US Senators, including Chris Van Hollen (D-Md. ), Roger Marshall (R-Kansas), and Elizabeth Warren (D-Mass. ), requested extensive details about Binance and its US partner Binance.US in the early days of March amid allegations of unethical business practices.
The senators claimed in a letter to CZ and Brian Shroder, CEO of Binance US, that the exchange and its affiliated companies have “purposefully” eluded regulators, helped transfer assets to criminals and sanction evaders, and withheld fundamental financial information from its users and the general public.