The plight of a detained U.S. Binance staffer has deteriorated as Nigeria turns him into a political pawn

The plight of a detained U.S. Binance staffer has deteriorated as Nigeria turns him into a political pawn

This morning, Binance’s head of financial crime compliance, Tigran Gambaryan, appeared before a federal high court in Nigeria, where he is facing tax evasion charges.

For anyone working in the booming field of crypto tracing, which includes everyone from law enforcement officials to analytics firms like Chainalysis and TRM Labs, Gambaryan is a star. He helped pioneer the field during his time as a U.S. special agent at the Internal Revenue Service, working on prominent cases such as the takedown of Silk Road and the Welcome to Video child pornography platform. And for the past month, he has been detained by Nigerian authorities, held as a de facto hostage in the government’s dispute with Binance.

The events of his arrest and imprisonment have already seemed ripped out of a spy movie. In late February, after the Nigerian government blamed Binance for its ongoing currency crisis, Gambaryan flew to Abuja with a colleague, Nadeem Anjarwalla, for a quick trip at the invitation of government authorities. After meeting with regulators and officials, the two employees were escorted back to their hotel and taken to a guarded house, where they were informed they could not leave.

Although the episode captured international headlines, the detention seemed rather innocuous, with Gambaryan and Anjarwalla allowed to use their phones and reports of a housekeeper who would make them green juice smoothies. That changed last week when Anjarwalla staged a dramatic escape, apparently using a concealed passport and slipping out after persuading security guards to let him attend prayers in an adjacent mosque. The government filed four new charges against the two employees the same day and has been coordinating with Interpol over a potential extradition (Anjarwalla’s whereabouts are unknown).

Meanwhile, Gambaryan’s conditions have deteriorated since the incident, according to a spokesperson for his family, though she cautioned that an aggravated situation likely would’ve happened regardless of Anjarwalla’s escape. Gambaryan can no longer communicate with friends and family with his phone, and he has been moved from the guard house to a detention facility, which the spokesperson described as a cell. There is fear that Gambaryan could be moved to a prison, where his safety would be at even greater risk. “That escalation is very prevalent,” she said.

What has become clear over the past month is that Gambaryan and Anjarwalla are pawns in the Nigerian government’s efforts to extract a massive fine from Binance, with authorities accusing the exchange of moving $26 billion illegally out of the country in 2023. One official suggested that a penalty on the platform could be as high as $10 billion, which would be more than double the recent settlement with the U.S. government.

Whether Binance is guilty of tax evasion or currency manipulation is a separate matter—the pressing question here is whether Gambaryan is being held captive as a bargaining chip. According to a statement shared by a Binance spokesperson, who declined to comment further, Gambaryan’s team has responded to more than 600 information requests coming from Nigerian law enforcement agencies and provided multiple training sessions for Nigerian law enforcement officials. He also has “no decision-making power in the company,” according to the statement. Gambaryan’s imprisonment reflects a worrying trend of “hostage-taking laws,” where workers from companies can be held prisoners as leverage.

Perhaps more concerning is the non-response from the U.S. government. Binance, of course, is not the best friend of any U.S. politician or official, especially in the wake of November’s criminal enforcement action. Even so, Gambaryan’s spokesperson told me that his wife, Yuki, has reached out to the U.S. embassy, State Department, and senators and received what she described as “limited engagement.” Another person working on the case, who requested anonymity to speak freely, said there has been “zero movement” from the U.S. government.

Most recently, Yuki contacted Sen. Cory Booker (D-N.J.) and Rep. Sara Jacobs (D-Calif.), who recently led a Congressional delegation to Nigeria to discuss democracy and freedom. When I contacted Booker’s office, a spokesperson told me that the delegation had already left Abuja prior to receiving outreach from the family. I also reached out to the State Department, which did not respond.

For now, Gambaryan’s situation grows more dire by the day. At today’s hearing, a judge adjourned his case until April 19, while a separate hearing for Binance was adjourned until April 8. Arguing that due process had not been followed, Gambaryan’s counsel, Mark Mordi, pleaded that his client not receive charges on behalf of his employer, according to Bloomberg. “The world is looking at us, let’s not treat this matter in a trifling matter,” Mordi said.

Leo Schwartz
[email protected]
@leomschwartz

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https://fortune.com/crypto/2024/04/04/binance-nigeria-tigran-gambaryan-detained-conditions/

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