Key Insights
- Binance is in the middle of another lawsuit, this time around from a former employee.
- The ex-employee, Amrita Srivastava, alleges that Binance unfairly terminated her contract after she blew the whistle on a bribery scandal.
- Binance claims that Srivastava’s dismissal stemmed from poor performance and nothing else.
- The outcome of the ongoing case will set a precedent for how whistleblowing is handled in the Crypto space.
Amrita Srivastava, a former senior executive at Binance, has sued the cryptocurrency giant in the United Kingdom.
According to Bloomberg reports, Srivastava alleges that she was unfairly dismissed after exposing a bribery case within the company.
This case shines a spotlight on some of the internal challenges at Binance.
It also adds to the exchange’s ongoing challenges worldwide on both legal and entity levels.
Bribery Allegations Surface
Bloomberg reports that Srivastava worked on Binance’s Link platform, a program that connects external brokers and clients to the exchange.
She claims that she was unexpectedly fired in May 2023 after raising concerns about unethical practices within the company.
These concerns revolved around a colleague who accepted a bribe disguised as payment for “consultative services” from a customer.
The money was allegedly intended to fast-track the customer’s integration into Binance’s ecosystem.
To make matters worse, Srivastava alleges that this colleague did not disclose their relationship with Binance during this money exchange.
She reported the issue to senior management in April last year, trusting that it would be handled appropriately.
To her surprise, however, her contract with the exchange was terminated only a month later.
Binance, on the other hand, has denied allegations that Srivastava’s dismissal was related to the bribery case. The exchange also maintains that her dismissal was due to poor performance and nothing else.
“Ethics Are Black and White,” Srivastava States
During her tribunal testimony, Srivastava emphasized her belief that bribery and fraud are wrong.
“I was not willing to turn a blind eye to bribery and fraud, as these are clear ethical violations,” she said.
She described her time at the exchange as “chaotic and high-pressure,” far from her expectations when she joined a year before her dismissal.
The former employee said she believed that Binance was committed to building a solid compliance framework.
However, she was disappointed to find a lack of structure and accountability.
She says that her team at the company’s Link platform faced overwhelming pressure to recover lost revenue after links were discovered between a major customer and Iran.
The undue pressure for financial results worsened her internal stress and created what she describes as a dysfunctional work environment.
Career and Reputation at Stake
Per the lawsuit, Srivastava is seeking compensation for her unfair dismissal and whistleblowing, which could result in a massive financial award under UK law if the judge rules in her favor.
“My experience has been personally and professionally damaging. It’s something I will have to work hard to overcome in the years ahead,” she said, expressing concerns about the long-term damage to her career and reputation.
Binance, on the other hand, has rejected the claims.
The company maintains that the bribery allegations were already under internal investigation before Srivastava reported them.
“The decision to end her employment for poor performance pre-dated concerns she raised,” a Binance spokesperson said. “the issue was already under investigation by our internal audit team.”
The exchange reinforced its commitment to high workplace standards and described its working environment as one focused on “weeding out under-performers.”
Broader Legal Troubles for Binance
This ongoing lawsuit is the latest in a long list of legal troubles at Binance, which have occurred worldwide.
In the United States alone, the company has faced intense scrutiny from the Securities and Exchange Commission since June last year over allegedly offering unregistered securities.
The exchange settled other regulatory challenges with the US authorities later in November of the same year after agreeing to pay $4.3 billion in fines.
Changpeng Zhao, the then-CEO, pleaded guilty to the charges, eventually stepping down and serving four months in a federal prison.
At the time of writing, it remains to be seen how Srivastava’s lawsuit will end up in the UK courts.
At the same time, the case outcome could set the tone for whistleblower protections within the Crypto industry.
The ongoing case shows the internal challenges Binance faces and the broader issues of accountability in the Crypto space.
While Binance continues to navigate these challenges from within and without, regulators, investors, and industry stakeholders will closely watch its next moves.
