Families Sue Binance Over Hamas Funding Allegations
Families impacted by the October 7, 2023, Hamas attack on Israel have filed a lawsuit against Binance, which is the largest cryptocurrency trading platform in the world. They are accusing Binance and its former CEO, Zhao Changpeng, who was recently pardoned, of facilitating the transfer of over $1 billion to the accounts of the terrorist group responsible for the attack.
The lawsuit was filed in federal court in Fargo, North Dakota, on behalf of 76 plaintiffs and their families, who suffered losses due to various acts of terrorism in Israel. The suit targets Binance, Zhao, and senior executive Gnagin “Haina” Chen.
This legal action follows a criminal inquiry by the Department of Justice in 2023. Binance had pleaded guilty to money laundering during that inquiry, resulting in over $4 billion in fines, and Zhao was sentenced to four months in prison.
However, the lawsuit claims that Binance’s wrongdoing extends far beyond what was disclosed during the government’s proceedings, stating that it “knowingly sent and received over $1 billion related to accounts controlled by foreign terrorist organizations responsible for the October 7 attack.”
The suit names groups such as Hamas, Hezbollah, and Iran’s Islamic Revolutionary Guard Corps, citing them as beneficiaries of the transactions in question. The legal teams representing the plaintiffs include firms like Wilkie Farr & Gallagher and Motley Rice.
The complaint emphasizes that there has been no significant change in Binance’s business model, suggesting it was “deliberately designed as a criminal enterprise to facilitate global money laundering.”
One particular Binance account mentioned is owned by Ali Mohammad Alawi, the son of a Hezbollah commander. Additionally, other accounts related to Hamas and located in Gaza were identified in the lawsuit.
The allegations also touch on a money laundering scheme involving Hezbollah’s funds that are purportedly linked to illegal gold smuggling operations via virtual currency in South America. A 26-year-old Venezuelan woman supposedly managing a livestock company is accused of moving around $40 million through one account.
Jonathan Misner, a managing partner at one of the plaintiff’s law firms, stated that Binance exploited weak controls to transfer significant sums of money to sanctioned groups, effectively becoming a conduit for funding various violent activities. He stressed that families impacted by these acts of violence deserve justice.
Zhao remains a majority shareholder of Binance, and the plaintiffs contend that the company “knowingly and systematically supported Hamas, Hezbollah, PIJ, and similar organizations,” transferring significant funds to aid their violent efforts.
The lawsuit notes that some transactions related to Hamas were executed from IP addresses in the United States, including ones in Kindred, North Dakota.
“We believe these claims clearly demonstrate that Binance played a role in the October 7 attack,” remarked Lee Wolosky, a former senior official in the White House.
The lawsuit further outlines how Binance allegedly aided in financing the activities linked to the October 7 attack. The families are seeking an unspecified amount in compensation, alongside triple damages.
President Trump had pardoned Zhao after significant lobbying, which allowed him to re-enter the U.S. market. Following the pardon, Trump commented on his unfamiliarity with Zhao but noted that many people advocated for the clemency.
In light of ongoing litigation, a Binance spokesperson declined to comment but emphasized the platform’s compliance with international sanctions. Meanwhile, the U.S. Treasury has reiterated that virtual currencies are not commonly used by terrorist groups like Hamas.
