Binance charity sued over $9M crypto meant for cancer patients in Malta

Binance is attempting to liquidate its charity efforts in Malta in favor of an identical entity in the US, a move it says will reduce costs.

In Malta, the local non-profit council has walked back legal threats to Binance’s charity arm over three years of missing files, reports Malta Times.

Last Friday, Malta’s charity watchdog threatened to refer the Binance Charity Foundation — headquartered in Malta — to the police after it claimed Binance “ignored” reminders dating back to 2018.

Strangely, fast forward to Tuesday and the files have been located.

“The documents were submitted in September 2020 and were found in an electronic folder. Any inconvenience is regretted,” a council spokesperson said (via Malta Times).

Disputed donations for the terminally ill

Reappearing docs aside, Binance’s charity wing is still facing legal action in Malta.

The Malta Community Chest Foundation (MCCFF), a charity led by Maltese president George Vella, claims it’s yet to receive over $9 million in crypto (mostly BNB) that Binance promised to terminally ill cancer patients four years ago.

Indeed, the Binance Charity Foundation is facing a lawsuit from MCCFF after several failed attempts to recover the crypto — now worth about 10 times its value during the initial donation drive.

  • In November 2018, Binance and crypto project Tron kicked off fundraising with a $200,000 joint donation.
  • 20 pledges raised the equivalent of 250 BTC in total (at today’s prices), worth roughly $9.5 million.
  • 15,000 recipients were expected, but Binance’s site shows no crypto distributed from the charity pot.
Over $9 million in BNB sits with Binance. It should be with cancer patients.

[Read more: FATF suspicious of $70B in crypto flowing through ‘blockchain island’ Malta]

Binance lawyers reportedly say Binance Charity was supposed to direct donations straight to patients, rather than via MCCFF.

The exchange’s charity arm had previously promised to consider any suitable requests with regards to fund distribution.

Binance wants charity out of Malta

According to a Bloomberg report from March 2018, Binance was planning a move to Malta. Although, the exchange never managed proper licensing from Malta’s financial regulators.

Helen Hai — who heads up Binance Charity — still signed a Memorandum of Understanding with then-Maltese president Marie-Louise Coleiro Preca.

As part of that agreement, Preca was to serve as chair of Binance Charity’s senior advisory group. It’s said that no invites to any meetings eventuated.

“It was only when you brought this matter to my attention that I realized I am still listed on their website,” said Preca on Monday to Malta Times.

[Read more: Binance, FTX slash crypto leverage after NYT report on margin trading]

Binance recently attempted to liquidate its charity efforts in Malta in favor of an identical entity in the US.

MCCFF has filed an injunction to halt that process, alleging an attempt from Binance to move assets outside of the reach of Maltese authorities.

Lawyers for Binance claim the move was to avoid extra administration costs and the exchange has no intention of backing out of obligations.

Edit 12:49 UTC, Aug 5, 2021: Updated paragraph nine and 10 for clarity. Corrected references to the cryptocurrencies that make up the funds in question: mostly BNB and not Bitcoin as was originally reported. We apologize for the mistake.

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