Crypto exchange Binance is suing Forbes and two of its journalists for defamation, after the business magazine published an article on 29 Oct. based on a leaked document.

In the suit filed in the US District Court in New Jersey, Binance said Forbes had published several false statements claiming that the crypto exchange had used its corporate structure, which involves a Cayman Islands holding company, to “intentionally deceive regulators” and engage in activity “characteristic of money laundering”.

Citing slides from a leaked presentation, the Forbes article suggested Binance had conceived an elaborate corporate structure to “surreptitiously profit from crypto investors in the United States”.

Binance, which executes about $10 billion in cryptocurrency trades per day, described the statements as “false and highly defamatory”.

According to the Forbes article, the slideshow discussed ways of mitigating US enforcement and the need to undermine the ability of anti-money laundering and US sanctions enforcement to detect illicit activity.

The proposed structure constituted a “bait and switch” by including a US entity that would “distract regulators with feigned interest in compliance” while allowing it to “funnel back” revenue from the US subsidiary to the holding company through licensing fees, Forbes wrote. The article said the document was created by a former Binance employee, which the company denies.

In a press release, Binance said: “The Forbes report is based on a document which Forbes claims shows Binance’s corporate structure. The document is nothing of the sort. Rather, it is a slideshow proposal prepared by a third party – not by Binance or anyone on its behalf. The proposal was never implemented. Moreover, Forbes’ description of the document is a gross misrepresentation of what the document actually says.”

Binance’s attorney, Charles J. Harder, said “Forbes’ misleading story” had done great harm to Binance’s reputation.

“Binance demanded Forbes’ retraction or correction, but it has refused. This lawsuit therefore became necessary,” he said.

Forbes has not taken down the article and said it stands by its reporting.

The lawsuit states that the magazine’s “false public statements, misrepresentations and innuendo that Binance does not comply with applicable law, seeks to evade regulators, and is engaged in activity ‘characteristic of money laundering’ are highly damaging to Binance.”

Binance is seeking compensation as well as punitive damages, and demands that the article is permanently removed.

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