Court discharges Gambaryan, Anjarwalla from Binance tax evasion case

Justice Emeka Nwite of the Federal High Court yesterday discharged Tigran Gambaryan of Binance Holdings Limited and his fleeing colleague, Nadeem Anjarwalla, from the tax evasion allegations levelled against them by the Federal Inland Revenue Service (FIRS)

The court’s decision followed a fresh set of amended charges filed by the FIRS after Binance appointed a Nigerian representative named Ayodele Omotilewa.

FIRS had on March 22, 2024, filed legal proceedings against the cryptocurrency exchange platform, alleging tax evasion.

On May 17, this year, the FIRS amended its lawsuit, alleging that Binance failed to collect and remit various categories of taxes to the federation, particularly the Value Added Tax (VAT) and Company Income tax (CIT), as stipulated by Section 40 of the FIRS Establishment Act 2007 as amended.

In the suit, Binance was listed as the first defendant, Gambaryan was listed as second defendant while Anjarwalla’s name appeared as being at large.

At the resumed proceedings yesterday, counsel for Binance, T.J. Krukrubo (SAN), told the court that his client has forwarded the name of its official representative to the FIRS and to the court.

Counsel for the FIRS, Moses Idehu, confirmed the assertion and asked the court’s permission to substitute all the previous charges with the fresh amended ones dated June 13, 2024.

He told the court that the FIRS has discontinued its case against Gambaryan and Anjarwalla.

In FIRS’ fresh charge, Binance is now listed as the sole defendant, implying Gambaryan and Anjarwalla are no longer associated with its case.

In the charge, the Binance trading platform was accused of offering services (in the buying and selling of cryptocurrencies and in the remittance and transfer of those assets) to Nigerians while failing to deduct the necessary VAT arising from its operations.

“That you BINANCE HOLDINGS LTD on or about the 1st February, 2024, in Abuja, FCT within the Jurisdiction of this Honourable Court, whilst involved in the offering of services to subscribers on your trading platform, known as Binance, did aid and abet those subscribers on your trading platform to unlawfully refuse to pay taxes, or neglect to pay those taxes and in so doing committed an offence contrary to and punishable under the provisions of S.94 of the Companies Income Tax Act (as amended),” Count 4 of the four-count charge reads.

However, Idehu urged the court to direct that the Binance representative from Nigeria should enter the dock and take his plea on behalf of the corporation he represents.

But Krukrubo contended that Nigerian laws do not mandate a representative of a company that is sued to stand inside a dock and take a plea.

He argued that a representative of a company that is sued may not need to attend proceedings and can even write a letter to the court in respect of the company’s position on a matter.

The defence seized the moment, urging the court to discharge Gambaryan and Anjarwalla from the FIRS case since a representative has been officially sent to the proceedings.

The FIRS also confirmed that the matter is now between the Federal Government and Binance.

Nwite said on the issue of whether the representative of Binance should be in the dock, parties should file a written address on it so he can rule.

Subsequently, he held that the “charges filed on March 22, 2024 and May 17, 2024 are hereby struck out.”

The judge also struck out the names of Gambaryan and Anjarwalla from the case, directing that the case be adjourned to July 12 for plea.

He added that the lawyers to the parties should file processes on whether the Nigerian representative should be in the dock or not.

Recall that the Federal Government had accused the cryptocurrency firm of influencing foreign exchange (FX) rates, resulting in stricter oversight of crypto trading platforms.

The EFCC is separately prosecuting Binance and its executives over alleged money laundering and foreign exchange contravention.

On February 28, 2024, Nigerian authorities detained two senior Binance executives: Nadeem Anjarwalla, a 37-year-old British-Kenyan, who serves as the regional manager for Africa, and Tigran Gambaryan, a 39-year-old American, who is the head of financial crime compliance at Binance. They were held for several weeks but Nadeem fled from custody.