From the description of the VIP treatment given the two Binance executives abducted by the Nigerian government in a Mohammed bin Salman’s Ritz-Carlton style, one gets the impression that they did not think their tactic through. They detained the men (Nadeem Anjarwalla and Tigran Gambaryan) deemed economic sabotages, still allowed them several privileges, somehow forgot to put them on a watch list, and one of them managed to escape. Nigeria’s handling of the Binance affair suggests that their detention and proposed trial were half-hearted. So desperate was the government to find a scapegoat that they invited Binance officials, detained them, and demanded $10bn from their employers.
The government alleges that some unscrupulous elements use Binance for money laundering, terrorist financing, currency speculation and market manipulation, thus distorting the Nigerian economy and weakening the Naira against other currencies. Nigeria also accused them of offering taxable services without remitting taxes to the country. The government said over $21.6bn was traded by Nigerians whose identities were concealed by Binance. These accusations are grievous, and I agree that they should be addressed. However, it was foolish to arrest, detain the Binance officials, and demand money. Even the bandits that abduct schoolchildren for a living are far more tactical. By doing that, Nigeria overplayed its hand.
People like to come up with how the United States similarly extracted $4.3bn from Binance to justify the detention of Anjarwalla and Gambaryan, but seem to forget that the US—despite the leverage it has over Binance since the country is their major market— did not resort to abducting company officials and demanding payment. They spent years piling up evidence and going to court. Their prosecutors demonstrated that Binance violated federal anti-money laundering and sanctions laws through lapses in its internal controls. They failed to report more than 100,000 suspicious transactions involving designated terrorist groups including Hamas, al Qaeda, and ISIS. Prosecutors also alleged that Binance’s platform supported the sale of child sexual abuse materials and was among the largest recipients of ransomware proceeds.
Nigeria has relatively little leverage over transnational corporations like the US does, and we would have done far better by addressing the situation through the instrument of the law, diplomacy, policies, technical expertise, and moral suasions. If Binance has not been remitting taxes to Nigeria, we should create a policy framework and technical structure that facilitates it. The fact that they sent two of their workers to Nigeria suggests good faith on their part. We should have worked hand in hand with the company to resolve the issues raised.
But trust Nigerian officials. They like gragra. Thinking through situations can be too tasking for them, so they quickly resort to the sole weapon of their warfare: force. Everything must be remedied through a blatant show of force. What exactly did they think they would achieve by abducting two Binance officials and demanding $10bn?
But trust Nigerian officials. They like gragra. Thinking through situations can be too tasking for them, so they quickly resort to the sole weapon of their warfare: force. Everything must be remedied through a blatant show of force. What exactly did they think they would achieve by abducting two Binance officials and demanding $10bn?
