Binance sets up first-ever board of directors amid legal woes: details

The past few years have not been smooth sailing for Binance, which has repeatedly found itself surrounded by legal issues. For the first time, Binance Holdings has established a board of directors consisting of seven members – who will weigh in on the company’s decision-making and business-related resolutions as an aid to CEO Richard Teng. The decision comes after the exchange was recently subpoenaed by Nigerian authorities on suspicions of the exchange’s involvement in facilitating illegal activities.

This is the first time in the seven years since Binance was established that the company has formed a board of directors. Gabriel Abed, the ambassador of Barbados to the UAE, was appointed as the chairman of the board of directors of Binance. Company CEO Teng along with co-founder Heina Chen are also part of the board, official blog post revealed.

“This significant change in leadership is seen as a central change at Binance under the supervision of CEO Richard Teng, who was appointed in November following Binance’s settlement with US authorities. Since its founding in China in 2017, Binance claims to operate without a global headquarters. However, Teng has indicated his desire to implement a more conventional corporate structure, including the designation of headquarters and an effective board of directors,” Binance said in the post.

Given the company’s ongoing litigation, it seems only natural that the company has decided to bring in more industry experts to manage its operations.

Binance was investigated by the US Securities and Exchange Commission (SEC) last year for violating US business laws. In November 2023, the exchange’s founder Changpeng Zhao pleaded guilty to failing to maintain an effective anti-money laundering program at the company.

Soon after, Zhao resigned as the company’s CEO and Binance paid a sum of $4.3 billion (roughly Rs. 35,855 crore) in penalties to the US Department of Justice, the Treasury Department and the Commodity Trading Commission futures.

Following Zhao’s resignation, Teng was appointed as the exchange’s new CEO. However, even under Teng’s leadership, Binance’s legal woes appear no closer to being resolved.

Earlier this month, the Nigerian House of Representatives Committee on Financial Crimes had it is reported summoned Binance CEO Teng over suspicions of the exchange’s potential involvement in money laundering and terrorist financing. While the details of Teng’s arrival in Nigeria for this meeting remain unknown, a Binance executive has been detained by Nigerian authorities it is reported escaped and flew abroad, leaving the company in an awkward situation.

Binance’s bid to become the world’s most licensed crypto exchange also hit a snag after the Philippines announced a ban on the exchange, citing its lack of an official operating license.

Since 2022, Binance has assembled a solid team of lawyers to help it deal with legal issues.