Binance says it has suspended an employee for insider trading after launching an investigation that was prompted by a complaint.
In a new announcement, the world’s largest crypto exchange platform by volume says that an employee committed insider trading when working in a development role on its BNB Chain, prior to joining the Binance Wallet team.
Says Binance,
“Leveraging information from his former position as well as his familiarity with on-chain projects, the employee was aware the project was planning a Token Generation Event (TGE) and anticipated it would generate significant community interest. Prior to the project’s public token launch announcement, the staff member used multiple linked wallet addresses to purchase a large volume of the project’s tokens.
Following the announcement, the staff member quickly sold part of his holdings to realize significant profits, while the remaining tokens retained considerable unrealized gains. This behavior constitutes front-running based on non-public information obtained from his previous role and is a clear breach of company policy.”
Binance’s internal audit team uncovered the employee’s wrongdoing after conducting an investigation triggered by a March 23rd complaint. As a result of the preliminary investigation, the employee was “suspended immediately” and may face additional disciplinary action, which could include legal action.
“We will proactively cooperate with the relevant authorities in the employee’s jurisdiction and take appropriate legal action in accordance with applicable laws.”
Binance is also rewarding the four people who submitted information that brought the incident to its attention.
“For those who submitted valid reports via Binance’s official whistleblowing channel (audit@binance.com), we have completed the verification and de-duplication process. As committed, a total reward of $100,000 will be equally distributed.”
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