The world’s largest crypto exchange Binance has been sued by the US Commodity Futures Trading Commission (CFTC) for allegedly breaking the rules by operating an illegal exchange and a sham compliance programme.

The US market regulator has filed a lawsuit against the company as part of a broader crackdown on companies dealing with cryptocurrency.

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According to the CFTC’s complaint on Monday, March 27, Binance executives knew for years that “they were violating CFTC rules, working actively to both keep the money flowing and avoid compliance”.

The regulator also alleged that Binance grew its US user base and concealed it while failing to establish the money-laundering checks required of financial institutions. The CFTC is seeking to ban Binance founder Changpeng Zhao and his companies permanently.

In response to the CFTC’s complaint, Zhao issued a statement expressing his surprise and disappointment. He also noted that Binance had worked collaboratively with the CFTC for over two years.

In a blog post on Monday, Zhao stated, “The complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterisation of many of the issues alleged.”