Main conclusions

  • In the new issue of Playing by the Rules, a blog series dedicated to Binance's compliance program, we're expanding the number of our corporate compliance team.

  • The scope of work of Binance's Corporate Compliance department spans a wide range of disciplines, including regulatory examination and audit management, product compliance, third-party due diligence, monitoring and testing, risk assessment and governance, policy, and learning and development.

  • The Corporate Compliance Team helps ensure Binance adheres to legal and regulatory requirements in every aspect of its operations, maintains strict compliance controls, and continually improves its operations to stay at the forefront of the industry.

Binance is a major global organization that employs thousands of people, serving users in many disciplines that have different regulatory requirements for activity related to digital assets. In order to responsibly promote financial freedom around the world and ensure the safety of our customers, we must ensure that every internal system and trading activity within Binance is designed and operates in a manner compatible with all applicable rules and regulations. Given Binance's size and geographic diversity, as well as the ever-evolving regulatory status and level of cryptocurrencies, having one team serving all pillars of the compliance program to set up risk-based approaches and enhance transparency is a truly monumental task. Our Corporate Compliance team takes responsibility for this significant, essential work.

The scope of the team's functions includes regulatory examination and audit management, product compliance, third party due diligence, quality assurance, compliance risk management and risk governance, policy and program, and learning and development. There are specialized teams to handle the types of work within the Corporate Compliance department.

For example, the Program and Policy team maintains and regularly updates the anti-money laundering and sanctions programs that apply to Binance's global suite of products and services. The Product Compliance team works closely with the Product and Technology teams to ensure that AML/risk-based sanctions controls are integrated into both the company's products and services. Regardless of the specific focus, each of these teams works to ensure that appropriate compliance measures are in place at every level of the organization. Our Corporate Compliance team is led by Christine Hecht, recently appointed Vice President of Compliance at Binance, responsible for reporting global money laundering incidents.

Binance's compliance approach

At the core of Binance's corporate compliance program is a pioneering risk-based approach that shapes our commitment to user protection and compliance culture and strategy from the highest levels of the organization down. It starts with carefully identifying the key areas of compliance risk management for Binance, the industry, and the global regulatory environment. On this basis, our compliance team has developed a six-step process aimed at identifying an organization's exposure to key risks, in addition to developing a structured methodology for identifying, assessing, mitigating and continuously monitoring risks. Our corporate compliance team then puts this methodology into practice.

Proper risk management and leadership also play an essential role in effective compliance risk management at Binance. There are sophisticated internal compliance risk management advisory bodies in the organization charged with managing compliance risks and oversight responsibilities in line with the requirements of global and local compliance standards.

In addition, for all regulated entities reporting directly to the local board and its relevant sub-committees, there is enhanced risk and compliance management to ensure regulatory requirements are met. This structure ensures the appropriate level of focus and emphasis on regulatory compliance, and promotes effective decision making by the leadership team.

Implementing a compliance risk management program across Binance relies on close collaboration between different teams, accountability and ownership. Regional teams and business units have the ability to identify and escalate issues using implemented risk processes and structures, which support our comprehensive approach to all levels of the organization by providing feedback from the bottom of the ladder to the top.

Test compliance controls across organizations

An organization the size of Binance is made up of many business processes that flow within and across its units and departments, and controls are in place to ensure each of these processes is run in accordance with all applicable rules, policies, and regulations. The job of the QA team within the Corporate Compliance department is to perform QA testing of these business processes and align them with Binance policies and local regulatory requirements. The goal of the quality assurance framework is to periodically evaluate the quality and effectiveness of controls, as well as identify deficiencies and problems.

The Quality Assurance team monitors and tests compliance controls by sampling and verifying them against a pre-defined test script derived from relevant policy and procedure documents. Any errors and problems identified in the course of these reviews are communicated to the stakeholders and teams responsible for correcting them, and the results of these reviews are reported to the company's management.

With consistent and regular reviews, corporate compliance quality assurance fosters a culture of continuous improvement and helps ensure compliance controls are strictly implemented at various levels within an organization.

Dealing with regulatory checks and audits

Binance is regularly subject to external regulatory examinations and audits. Preparation is a collaborative process involving stakeholders from the broader compliance team, internal audit, operations, legal, and other departments. They are all driven by the common goal of ensuring that Binance's policies, procedures and operations meet regulatory and legal requirements in the many jurisdictions around the world where we operate.

As the global regulatory environment and associated compliance requirements are still evolving and have not yet taken final form, we are working hard to ensure we understand the changing landscape and continue to operate in a compliant manner.

In each jurisdiction, our Compliance, Legal and Operations departments work closely with local experts to ensure compliance requirements are followed and applied to the services we provide. When it is time for a regulatory examination and audit, whether regularly scheduled or immediate, the Corporate Compliance team collaborates with the relevant local teams to provide any necessary support. Many of the team members are former organizers and examiners themselves, so they can help in a targeted way.

For regulated entities, the examination and audit process is led and managed by local responsible persons, and the final decision is made with the Board of Directors and senior management (including compliance and risk) based in the country concerned. Corporate Compliance is available as a shared resource to assist and support local teams through the screening and auditing process.

Compliance training for employees at Binance

The primary goal of our compliance program is to ensure that every Binance employee has adequate awareness of compliance requirements and understands the importance of a strict company-wide compliance culture, which supports our commitment to protecting our users. In this regard, we require every employee to undergo regular compliance training. Through these mandatory training programs, the Compliance Learning and Development team strengthens the organization's compliance culture and ensures that all employees understand and adhere to legal and regulatory requirements.

Every Binance employee must undergo a series of global compliance training modules covering core topics, such as anti-money laundering and counter-terrorism financing, sanctions compliance, anti-bribery and corruption, market abuse prevention and employee engagement policies. These trainings include assessments that each employee must successfully complete within a limited period of time.

In addition to mandatory training, the Compliance Training Team identifies Binance's compliance training needs using a variety of methodologies, including surveys, interviews, and knowledge assessments, as well as monitoring relevant regulatory developments. Based on the training needs assessment, the team prepares e-learning training programs that comply with modern regulatory requirements, industry best practices, and organization policies. The team also prepares advanced training programs tailored to the leadership team that focus on the compliance duties and obligations that the leader must understand and understand.

Binance also encourages and sponsors employees to obtain globally recognized credentials through professional organizations, such as the Association of Certified Anti-Money Laundering Specialists (ACAMS) and the Association of Certified Sanctions Specialists (ACSS).

The overall effectiveness of training programs is evaluated by collecting feedback from participants and conducting assessments to measure knowledge retention and application. It is expected that the results will be used to identify any gaps or areas of improvement for the necessary reviews of training materials or information delivery methods.

Concluding thoughts

Binance's corporate compliance team plays a key role in keeping the organization safe and secure while ensuring compliance with applicable rules and regulations. The ever-evolving regulatory landscape for digital assets requires a comprehensive and proactive approach to compliance. By focusing on the key areas described above, the Corporate Compliance team delivers on our commitment to protecting users in accordance with global regulatory standards.

  • Playing by the Rules: An overview of cryptocurrency compliance in today's world

  • Playing by the Rules: An Overview of Binance's Compliance Program (Binance)

  • Experts from Binance's compliance team

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