Following eight months in custody, Binance official Tigran Gambaryan has been released by the Abuja Division of the Federal High Court, unexpectedly concluding his involvement in a Money Laundering case initiated by the Economic and Financial Crimes Commission (EFCC). The government of Nigeria dropped all allegations against him, stating that he was just an employee of the company and should not be responsible for their financial activities. Gambaryan found himself in legal difficulties starting in February when he travelled to the nation at the federal government’s request to address Nigerians’ Cryptocurrency operations on Binance.
Unfortunately, this trip resulted in his arrest and eventual imprisonment. His associate, Nadeem Anjarwalla, who was apprehended with him, managed to escape custody in March, while Gambaryan was left behind to face legal battles. Justice Emeka Nwite refused to grant him bail twice, extending his time in custody, initially in a government-owned guesthouse and later in the notorious Kuje Prison. The EFCC’s allegations against the executive were linked to inquiries into the company’s activities in the region, which officials assert have negatively affected the national economy.
US lawmakers and officials played a key role in securing his release.
Nevertheless, on Wednesday, R.U. Adagba, representing the EFCC, announced in court that the agency had dismissed the charges due to his declining health condition. The American businessman faced serious health problems while in custody, suffering from malaria, among other ailments, which necessitated immediate medical care. Despite the suddenness of this decision, it followed weeks of intense diplomatic discussions between Nigeria and the United States. American legislators and officials urged the federal government to focus on securing Gambaryan’s release, ultimately resulting in his freedom.
Dele Oyewale, a spokesperson for the Nigerian government, stated that his release was approved on humanitarian grounds, enabling him to pursue medical treatment abroad. The unexpected news came as a shock, particularly since the court had set a hearing for October 25 to proceed with the trial. Now that the charges have been dropped, he will not be subject to further legal actions. However, the EFCC has clarified that the investigation into the organisation will continue, excluding the executive from further complications. Additionally, despite being regrettable, his arrest in the country was associated with the government’s worries about the company’s effect on regional economic stability.
Binance was accused of enabling the outflow of funds from local currency.
According to authorities, Binance facilitated the outflow of funds from the local currency, the naira, to foreign currencies, contributing to the decline of the local currency. Although the charges against Gambaryan have been dismissed, the cryptocurrency firm’s nationwide examination is significant. The Federal Inland Revenue Service (FIRS) has initiated an independent legal action against Binance Holdings at the same Federal High Court in Abuja. Accusations of Tax Evasion directed at the company further increase the challenges faced by Binance in Nigeria. Moreover, Nigeria is facing its worst economic crisis in decades, the worst in many years. It is characterised by increased Inflation and a drop in the naira’s value.
Government representatives have identified the increase in cryptocurrencies, especially exchanges like Binance, as a key factor behind this financial instability. The ability for citizens to convert and exchange their Naira for foreign currencies through Crypto platforms is perceived to weaken the local currency further, intensifying the nation’s economic challenges. Despite all these events, the organisation has encountered legal issues on a global scale. Changpeng Zhao resigned as CEO in November 2023, pleading guilty to money laundering violations. In April 2024, Zhao was imprisoned for four months after the company agreed to a $4.3 billion settlement with U.S. regulators.
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On the other hand, the federal authorities perceive the company’s activities as factors leading to the depreciation of the naira and regard digital currencies as undermining the country’s financial independence. With more individuals opting for cryptocurrency to protect against the unstable local currency, the government is more committed to imposing regulations or limitations on these platforms to prevent the economy. While the executive is no longer part of this situation, it underscores the persistent conflicts between cryptocurrency companies and global governments.