Binance has on Monday been sued by more than 300 victims and families connected to the October 7, 2023 attacks in Israel, directly accusing it, founder Changpeng “CZ” Zhao, and senior executive Guangying Chen of “knowingly facilitating” crypto payments for Hamas, Hezbollah, and other US-designated terrorist organizations.

The plaintiffs are using the Justice Against Sponsors of Terrorism Act, a clause in the Anti-Terrorism Act, to press charges.

According to Bloomberg, the 284-page lawsuit claims Binance’s platform processed over $1 billion in crypto transactions tied to those terrorist groups.

The filing says that before the attacks, which reportedly killed 1,200 people and left 250 hostages, Binance had already allowed hundreds of millions of dollars to flow into the hands of Hamas and its allies.

Lawsuit alleges Hamas-linked activity after Binance’s guilty plea

This new complaint goes beyond what the US government made public when CZ pleaded guilty to money laundering violations in 2023.

At the time, Binance agreed to pay $4.3 billion in penalties and admitted in a blog post to “historical, criminal compliance violations.”

CZ also stepped down as CEO and served four months in prison before being pardoned by President Donald Trump, who is now in office again. Guangying Chen was not charged in that case.

The suit claims Binance continued to allow suspicious activity even after that plea. It outlines specific wallets used by Hamas, Hezbollah, Palestinian Islamic Jihad, and Iran’s Revolutionary Guard Corps, and says the company knew these groups had accounts.

The complaint accuses Binance of “intentionally structuring itself as a refuge for illicit activity,” saying funds in those accounts “could foreseeably be used to commit terrorist attacks.” The plaintiffs argue some of those funds were in use after the platform’s guilty plea.

The lawsuit also brings in an angle involving illegal gold operations in Venezuela. It says criminal groups there mined gold and smuggled it into Iran, helping finance attacks by Hamas and Hezbollah.

A 26-year-old Venezuelan woman is named as part of the network. She allegedly handled $177 million in crypto and pulled $43 million in cash while acting as a “front for Hezbollah’s gold smuggling network.”

US officials link Bitcoin fundraising to Hamas military wing

US enforcement bodies like the Justice Department and FinCEN previously said that Binance was aware that Hamas’s military arm, the al-Qassam Brigades, had been raising money through Bitcoin.

They said Binance didn’t file suspicious activity reports tied to Hamas’s fundraising efforts. Under US law, the company was supposed to stop any terrorist group from using the financial system by running a proper anti-money laundering program, checking its users, and filing alerts when needed.

Instead, the complaint says Binance let crypto move without restrictions. Legal fights are underway over where the lawsuits should be handled. Binance isn’t based in the US, and jurisdiction is still being decided.

Two other lawsuits are moving forward in New York, and one more is pending in Alabama. But the new North Dakota case cites two separate transactions that came from IP addresses in Kindred, North Dakota, giving local courts a reason to keep it.

In the New York lawsuit, Judge John Koeltl ruled on February 25 that victims had “alleged plausibly” that Binance “knowingly and substantially assisted” the attacks. He agreed that the company was “generally aware that they were playing a role in Hamas’s and PIJ’s overall terrorist activities.”

He ordered further investigation to determine if New York had proper jurisdiction. Binance pushed back hard, saying Judge Koeltl “misapplied the law on aiding and abetting,” and claimed that the company’s services don’t have “any definable nexus” to terror activity. Their lawyers added that the plaintiffs failed to prove a direct connection to the attacks.

Under the Anti-Terrorism Act, companies can be held liable and forced to pay triple damages if they are found to have given “substantial assistance” to a terrorist act. The list of people suing in North Dakota includes survivors, family members, and the estates of those killed in the October 7 attack.

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