Nigeria escalates grandstanding over Binance after bribery allegation exposure by its executive
By Jeph Ajobaju, Chief Copy Editor
Nigeria has escalated its rhetoric against Binance in a third lawsuit that seeks to compel the cryptocurrency platform to pay N79.51 billion and N231 million ($81.5 billion) as penalty for alleged economic losses caused by its operations in the country.
The filing at the Federal High Court in Abuja by the Federal Inland Revenue Service (FIRS), marked FHC/ABJ/CS/1444/2024, also seeks payment of $2.001 billion in income taxes for 2022 and 2023.
The latest twist came less than a week after Binance executive Tigran Gambaryan publicly named President Bola Tinubu’s National Security Adviser (NSA) Nuhu Ribadu and three federal lawmakers as having allegedly demanded bribes from him to kill the case against him (Gambaryan) and Binance.
Gambaryan, in a series of widely circulated posts on X that rattled Aso Rock and the National Assembly (NASS), also alleged that Tinubu scapegoated Binance for his naira policy failure.
The new lawsuit accused Gambaryan and Binance Chief Executive Officer Nadeem Anjarwalla of contravening Nigerian laws, including failing to register with the FIRS for tax compliance and causing economic losses to the country, per Daily Post.
The lawsuit is the third currently before the trial court against Binance.
The FIRS and the Economic and Financial Crimes Commission (EFCC) had charged the company with tax evasion, money laundering, and foreign exchange violations before Justice Emeka Nwite of the Federal High Court in Abuja.
The monetary claims in that lawsuit included a 10 per cent penalty for non-payment of taxes for 2022 and 2023, a 26.75 per cent interest rate (the prevailing Central Bank of Nigeria lending rate) per annum from 1 January 2023 and 1 January 2024, among other penalties.
Both Gambaryan and Anjarwalla were detained, but Anjarwalla found a way to escape from Nigeria with a Kenyan passport.
in October 2024, the Nigerian government dropped money laundering charges against Gambaryan, a former United States agent, was released through the intervention of American officials and he left the country.
In the latest lawsuit, the FIRS alleged that Binance concealed its business activities in Nigeria, despite having a significant economic presence in the country.
It also accused Binance of breaching Nigeria’s Companies Income Tax Act, the Federal Inland Revenue Service (Establishment) Act 2007, the CBN Regulatory Framework for Mobile Money Services, and the CIT Significant Economic Presence (SEP) Order.
The SEP Order, signed by former Finance Minister Zainab Ahmed and gazetted in May 2020, defines significant economic presence as foreign companies deriving at least N25 million annually from digital services in Nigeria.
An affidavit deposed to by Jimada Yusuf, a member of the Special Investigation Team from the Office of the NSA, alleged that Binance had operated in Nigeria for over six years without registration.
The affidavit also alleged that
- During a 2024 meeting with the Securities and Exchange Commission (SEC), Binance executives (Anjarwalla and Gambaryan) admitted to having 386,256 active Nigerian users on its platform, with a trading volume of $21.6 billion and net revenue of $35.4 million for 2023.
- Binance operated without required licences and permits, non-compliance with the Money Laundering Act, offering unauthorised financial services, and providing currency speculation services.
- Binance unlawfully listed and traded Nigerian naira on its platform, even after claiming it had delisted the currency following investigation.
- Binance refused to provide detailed business records spanning six years, despite a Federal High Court order mandating disclosure to FIRS via the EFCC.
FIRS lead counsel Kanu Agabi SAN, was present in court on 11 February 2025 when the suit was called for a hearing before Justice Inyang Ekwo. The legal team of Binance was absent.
Agabi informed the court that attempts to serve Binance directly had been unsuccessful and he had filed a motion for substituted service on them.
The Judge granted the motion and directed that substituted service be carried out within seven days. The case was adjourned until March 3.
The FIRS is seeking the following reliefs:
“A declaration that Binance is liable to pay annual corporate income tax for having a significant economic presence in Nigeria.
“A declaration that Binance and its executives must file income tax returns for 2022 and 2023. An order compelling Binance to pay $2.001 billion in taxes for 2022 and 2023.
“Penalties, including 10 percent annual interest and a 26.75 percent CBN lending rate, until the taxes are fully paid. Compensation of $79.51 billion and N231 million for economic losses.”
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