Federal Inland Revenue Service (FIRS) of Nigeria has chosen to withdraw tax evasion accusations against Binance executives Nadeem Anjarwalla and Tigran Gambaryan.
The move comes just one week after sixteen U.S. lawmakers accused Nigeria of holding Gambaryan hostage, according to a report from Nairametrics.
Anjarwalla was freed from custody on March 22, but Gambaryan has been detained for 110 days.
Gambaryan will stay in detention because the Economic and Financial Crimes Commission (EFCC) has not yet dropped the money laundering charges against him.
Concerns have been raised about his health and well-being after his lawyers disclosed that he has been diagnosed with pneumonia and malaria.
Nigeria’s Charges Against Binance
The FIRS first brought tax invasion charges against Gambaryan and Anjarwalla in March 2024, claiming that they had neglected to pay taxes on bitcoin transactions totaling billions of naira.
Binance was charged with failing to file tax returns, failing to pay company tax, and failing to pay value-added tax.
Binance said Nigerian authorities have dropped some criminal charges against an executive at the world’s biggest crypto exchange who has been imprisoned in the country since April https://t.co/HCMq2GMlMp
— Bloomberg Crypto (@crypto) June 14, 2024
Gambaryan’s legal issues started earlier when the Nigerian anti-graft agency, the EFCC, detained him on suspicion of money laundering. He was held in custody for a few days before being released on bond.
On February 22, 2024, he made his court appearance in relation to the allegations of money laundering.
The Nigerian government, purportedly to be manipulating foreign exchange rates, has been clamping down on cryptocurrency trading platforms.
Due to accusations of money laundering and violating foreign exchange laws, the EFCC is pursuing separate prosecutions against Binance and its executives.
As part of a campaign against currency speculation, the Nigerian government banned cryptocurrency channels, which led to the arrest of the executives of Binance.
The situation has been further complicated by the devaluation of the Naira, which has lost 70% of its value against the dollar since last year’s foreign exchange reforms. This devaluation has been made worse by a local dollar shortage.
Binance Nigeria Conflict Takes a Turn
A Nigerian government official was allegedly pressuring cryptocurrency representatives to accept a covert agreement to resolve Nigeria’s claims against the exchange, according to Binance CEO Richard Teng’s accusation last month.
In reality, the $150 million “settlement” was a bribe from “someone in the Nigerian government.”
“Counsel reported back that he had been presented with a demand for a significant payment in cryptocurrency to be paid in secret within 48 hours to make these issues go away and that our decision was expected by the morning,” Teng wrote.
Nigeria, however, retaliated against Binance’s alleged bribery, asserting that it is merely an attempt to deflect attention from the exchange’s conduct.
Following regulatory scrutiny, Binance was forced to terminate all of its services involving the Nigerian naira (NGN), the local fiat currency of Nigeria.
Earlier, as part of a crackdown on the platform to stabilize the country’s local currency, the Nigerian government fined Binance an astounding $10 billion.
Around the world, Binance has come under growing regulatory scrutiny.
The Commodities Futures Trading Commission (CFTC) accused Binance of running an unauthorized digital asset derivatives exchange and breaking federal laws last year.
Similarly, the US Securities and Exchange Commission charged Binance Holdings LTD and CZ for allegedly operating unregistered exchanges, broker exchanges, clearing houses, and the unregistered offer and sale of securities.