- Binance's former CFO did not have full access to the company's financial accounts, Reuters reported on Monday.
- Binance has financials that are more akin to a "black box," with certain business units submitting "scant information," according to the outlet.
Binance's former Chief Financial Officer Wei Zhou did not have access to the company's full financial accounts during his nearly three-year tenure, Reuters reported, citing two people who worked with him.
Zhou, who left the Binance in 2021, did not immediately respond to Insider's request for comment.
The report follows promises from Binance CEO Changpeng Zhao, who said that the company would "lead by example" on embracing transparency after the downfall of competitor FTX, the once-$32 billion crypto empire started by Sam Bankman-Fried.
Binance.com, which has processed over $22 trillion worth of trades so far this year, has financials that are more akin to a "black box" and "mostly hidden from public view," according to a Reuter's analysis of the company's corporate filings.
The outlet reviewed filings by Binance entities in over a dozen jurisdictions where the exchange says it has "regulatory licenses, registrations, authorizations and approvals," which include locations like European Union states, Canada, and Dubai.
"The filings show that these units appear to have submitted scant information about Binance's business to authorities," the report said. "The public filings do not show, for example, how much money flows between the units and the main Binance.com exchange. The Reuters analysis also found that several of the units appear to have little activity."
Binance Chief Strategy Officer Patrick Hillmann said that the analysis of the units' filings were "categorically false." "The amount of corporate and financial information that has to be disclosed to regulators in those markets is immense, often requiring a six-month-long disclosure process," he said in a statement to Reuters.
"We are a private company and are not required to publicize our corporate finances," he added.
To be clear, Binance is not required to publish detailed detailed financial statements like its Nasdaq-listed competitor Coinbase. Binance doesn't disclose basic information like where Binance.com is located.
The company also doesn't report revenue, profit, or cash reserves. Binance has its own token, dubbed BNB, but hasn't revealed what role the coin plays on its balance sheet yet.
Binance published a "snapshot" of its holdings of six major tokens on its website last month and released a proof of reserves earlier this month, though critics have said such information is incomplete and can be misleading.
"It lends customers money against their crypto assets and lets them trade on margin, with borrowed funds. But it doesn't detail how big those bets are, how exposed Binance is to that risk, or the full extent of its reserves to finance withdrawals," the Reuters report said.
Binance did not immediately respond to Insider's request for comment on the matter.
The US Department of Justice is investigating Binance over potential money laundering conspiracy, unlicensed money transmission, and criminal sanctions violations, four sources told Reuters. Binance also reportedly processed over $10 billion in illegal payments this year.
A Binance spokesperson told Insider that it would be "inappropriate for us to comment" on matters related to the DOJ.