Multi-million dollar transfers to CZ firms confused Catherine Coley

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Reuters has reported that Binance directed over $400 million to be transferred from Binance US’s account at Silvergate bank to Merit Peak, a firm controlled by Changpeng Zhao (CZ).

The transfers reportedly began in late 2020 and continued through the first three months of 2021. Prime Trust, another entity that Binance US was using to hold customer funds, made $650 million in deposits to Binance US’s Silvergate account.

Catherine Coley, the then CEO of Binance US, reportedly didn’t understand the transfers and reached out to Susan Li, a Binance Finance executive for help. Li didn’t explain the transfers to Coley, except to say that Merit Peak provided trading services, capital injections, and loans to Binance US.

Some portion of the funds transferred to Merit Peak were apparently transferred again to Key Vision Development Limited, which also has CZ as a director.

Merit Peak allegedly put $1M into Binance.US

Merit Peak is reportedly a British Virgin Islands (BVI) incorporated entity run by CZ. It’s also thought to be a shareholder in Binance US, with CZ allegedly signing an order for Merit Peak to invest $1 million into Binance US. The New York Times previously reported that CZ owns approximately 90% of Binance US.

Forbes previously reported on the Tai Chi documents which described a plan to use Binance US as a regulatory shield to protect Binance.

Reuters also reported that Binance US’s exchange matching software was a “black box” that was managed by Binance. A separate document apparently revealed that Binance US’s Silvergate Accounts were controlled by Binance.

Coley left Binance US in April 2021 and hasn’t made any public statements since then.

The reporting paints a picture of a deeply conflicted relationship between Binance, Binance US, and CZ-controlled firms.

Read more: Binance wants you to think crypto money laundering isn’t an issue — it is

The Department of Justice has reportedly been investigating Binance for money laundering violations.

A Binance US spokesperson, Kimberly Soward, told Reuters that its information was “outdated,” that Merit Peak is no longer providing services to Binance US, and that only Binance US employees have access to Binance US bank accounts.

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