- Binance lawyers cite failed email in bid to drop $81 billion case.
- The crypto exchange is also on trial for money laundering and tax evasion in Nigeria.
- Binance's lawyers say officials violated procedural rules.
There’s a big difference between a dot and a dash. Perhaps as much as $81 billion of a difference.
On Monday, lawyers for Binance asked a Nigerian judge to invalidate an $81 billion penalty the nation’s tax agency is demanding the crypto exchange pay for operating without a licence.
The reason? A wrong email address. And a misspelled name.
When prosecutors representing the Federal Inland Revenue Service, or FIRS, notified Binance’s chief legal officer of the complaint weeks ago, it landed in the inbox of Eleanor-huges@binance.com, according to court documents seen by DL News.
The only problem was that there’s no hyphen in the address, and Eleanor Hughes’ surname was misspelled. So the notification was never delivered.
A goof
Ckukwuka Ikwuazom, Binance’s legal representative in Monday’s hearing, argued that the prosecutors’ mistake was grounds for throwing out the case.
According to Ikuazom, the prosecutors failed to follow the rules laid down by Nigeria’s Justice Ministry for serving court documents to respondents abroad.
It’s the sort of goof you’d expect from a phishing scam or a spammer, not from prosecutors representing a state agency.
Even more baffling is that the email doesn’t seem to exist. Upon contacting the address, DL News received a “mailer-daemon” email reply indicating the address was undeliverable.
This wasn’t the only mistake ― the prosecutors only reached out to that single, wrong contact.
Court filings show they didn’t copy anyone else from Binance’s legal team, even when it’s common to see prosecutors flood the inboxes of anyone associated with their target.
Staggering sum
The presiding judge, Justice Inyang Ekwo, adjourned the matter until April 30 to give prosecutors time to respond to the matter.
Yet there is little doubt the snafu is an embarrassing setback for the state’s legal team, given the staggering sum they are demanding from Binance.
In February, the FIRS approached a federal judge to impose $81 billion in back taxes and economic distortion penalties on Binance.
FIRS prosecutors accused Binance of harming Nigeria’s economy by failing to register and pay taxes to the government.
The charges deepened Nigeria’s legal action against Binance, which started last year when the Economic and Financial Crimes Commission, the country’s anti-corruption police, charged the firm for allegedly facilitating $35 million in money laundering.
The FIRS is also pursuing a separate tax evasion case against Binance.
Red notice
Those charges came after the government detained two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla. Both men had visited the country last February to negotiate with Nigerian officials amid a brewing regulatory crisis.
Anjarwalla, the exchange’s Africa regional manager based in Kenya, escaped detention last March. There’s an Interpol Red Notice against him, according to Nigerian officials.
Gambaryan, Binance’s financial compliance chief, spent eight months in Kuje prison until the Biden administration negotiated with Nigerian authorities for his release in October.
The crypto exchange has pleaded not guilty to the money laundering and tax evasion charges but hasn’t commented publicly on the $81 billion fine.
Last month, Nigeria’s Information Minister, Alhaji Mohammed Idris, told DL News that investigators found evidence of terrorists and kidnappers funnelling funds through Binance. Alhaji Idris said Binance’s operations exacerbated insecurity concerns in the country.
Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at osato@dlnews.com.
