Binance Blocks Accounts Tied to Relatives of Kremlin Officials

Binance Holdings Ltd. has closed many accounts related to relatives of key Kremlin officials in the midst of a surge of international sanctions in response to Russia's invasion of Ukraine.

Polina Kovaleva, the stepdaughter of Foreign Minister Sergei Lavrov, and Elizaveta Peskova, the daughter of President Vladimir Putin's spokesman Dmitry Peskova, were among those blacklisted over the last two months, according to the world's largest cryptocurrency exchange by trade volume.

Binance also stated that it had barred Kirill Malofeev, the son of Konstantin Malofeev, a businessman accused by the US Treasury Department of being a major source of funding for Russians pushing separatist in Crimea.

According to Chagri Poyraz, the firm's Vancouver-based global head of sanctions, the exchange is continuing its checks to hunt for new people affiliated with sanctioned individuals who may be utilizing its services.

"What distinguishes our compliance screening activities is that they are 'proactive,' attempting to discover and deter financial crime risk before any regulatory or legal action is taken against these individuals or businesses," he explained.

According to Poyraz, a former compliance officer at HSBC Holdings Plc, Binance halted the virtual currency exchange Garantex on March 11, several weeks before the Office of Foreign Assets Control targeted the business.

Binance, the largest crypto platform and the trading place of Bitcoin, Ethereum, BNB, Quint and the likes says Peskova was blocked on March 3 when she attempted to access the exchange through a third-party brokerage. The Treasury Department of the United States sanctioned her, the next week.

The company closed Kovaleva's account on March 24, the same day she was sanctioned by the UK. Malofeev, who was designated by the US Treasury on April 20, had his Binance accounts blocked this week, according to the company.

Peskova, Kovaleva, and Malofeev did not respond promptly to written demands for comment.

Following the European Union's recent sanctions against Moscow, Binance said last week that it is restricting services in Russia, one of its largest markets globally.

Binance has received praise from industry experts concerned about potential sanctions evasion through cryptocurrency as a result of the crackdown. However, it has sparked a response from others who believe the limits are excessive.