Coming as a crisis for the world’s largest crypto exchange, Binance, the Financial Intelligence Unit (FIU) has put a fine of Rs 18.82 crore on the company operating in India in violation of domestic anti-money laundering regulations.

“After considering the written and oral submissions of Binance, the Director, FIU-IND, based on the material available on record, found that the charges against Binance were substantiated,” a notification from the FIU said on Thursday.

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“Furthermore, specific directions have also been issued to Binance to ensure diligent compliance with the obligations outlined in Chapter IV of the Prevention of Money Laundering Act (PMLA) of 2002, in conjunction with the PMLA Maintenance of Record Rules (PMLA Rules) of 2005 for the prevention of money laundering activities and combating the financing of terrorism (AML CFT),” it said.

Effective anti-money laundering and combating the financing of terrorism (AML/CFT) policies and measures are key to the integrity and stability of the international financial system and member countries’ economies.

In December last year, Binance was barred from operating in India for not complying with local regulations as part of the financial watchdog’s crackdown on offshore crypto exchanges that were operating in the country without registration.

Binance registered with the FIU in May as it sought to resume operations in the country after being issued a showcause notice by the financial watchdog along with eight other offshore exchanges that were operating in violation of local rules.

While Binance has registered with the FIU, it can resume operations only after paying a penalty for previous non-compliance. This has now been fixed at Rs 18.82 crore.

Notably, India requires virtual digital asset service providers, like crypto exchanges, to be registered with the FIU and comply with obligations mandated under the country’s anti-money laundering rules.