How a Crypto Compliance Officer Ended Up in a Nigerian Prison

When he flew to Nigeria for a business trip in late February, Tigran Gambaryan, a top compliance officer at the cryptocurrency exchange Binance, packed a small suitcase with just enough clothes for two days.

A former U.S. law enforcement agent, Mr. Gambaryan knew the trip was risky. Only a few weeks earlier, he and a group of colleagues had rushed out of Nigeria, concerned that the local authorities might detain them, five people familiar with that trip said. This time, he assured his wife, he would “get in and get out.”

A month and a half later, Mr. Gambaryan is being held at Kuje prison in the Nigerian capital of Abuja, a complex that has housed Islamic State militants and Boko Haram fighters.

After meeting with government officials in Abuja on Feb. 26, Mr. Gambaryan, 39, and a Binance colleague, Nadeem Anjarwalla, were abruptly escorted to a guesthouse controlled by Nigerian security officials, where they were held for nearly a month with no formal charges filed against them.

Then, late last month, Mr. Anjarwalla, the company’s regional manager for Africa, escaped under mysterious circumstances. Initial reports suggested he had fled Nigeria after guards permitted him to leave the guesthouse for Ramadan prayers.

Within days of the escape, the Nigerian government charged Mr. Gambaryan, Mr. Anjarwalla and Binance itself with tax evasion and money laundering — effectively accusing the company and two midlevel employees of the same crimes.

This account of Mr. Gambaryan’s detention in Nigeria is based on interviews with Nigerian officials, crypto compliance experts and a dozen other people with knowledge of the situation, many of whom requested anonymity to discuss a legally sensitive matter.

In an April 3 statement, Binance denied that Mr. Gambaryan had any “decision-making power” in the company and said that he should not be “held responsible while current discussions are ongoing between Binance and Nigerian government officials.”

A Binance spokesman, Brad Jaffe, said the company had “great respect” for the Nigerian government and remained engaged in “good faith discussions at all levels.”

Mr. Gambaryan’s arrest is the latest flashpoint in years of legal troubles for Binance, the world’s largest crypto exchange. The company is trying to rebuild after it agreed to pay $4.3 billion in penalties last year to settle charges by several U.S. agencies that it violated economic sanctions against Syria, Cuba and Iran while allowing criminal activity to flourish on its platform.

The case also shows how the crypto industry, built on technology that was originally designed to circumvent the global financial system, is still struggling to stay on the right side of law enforcement in countries around the world. In November, Binance’s founder, Changpeng Zhao, stepped down as chief executive and pleaded guilty to money laundering violations in the United States.

Binance replaced Mr. Zhao with Richard Teng, a former Singaporean regulator, and continued to operate worldwide, but with a smaller staff after it laid off 3,000 of its nearly 8,000 employees last year.

Around the time of the leadership change, Binance was working with the Nigerian government, hoping to collaborate on efforts to monitor crypto transactions for financial crime. But those discussions deteriorated as Nigerian officials voiced suspicions that Binance was committing some of the same crimes that the United States had investigated.

With one of the largest economies in Africa, Nigeria has recently become a hot spot for digital currencies: It has the second-highest rate of crypto adoption in the world behind India, according to Chainalysis, a data firm. Some Nigerians have turned to crypto as an alternative to the local currency, which has depreciated substantially over the past two years.

Mr. Gambaryan, a weight lifter who practices martial arts in his spare time, spent his early childhood in Armenia before moving to Fresno, Calif. as a preteen. He now lives outside Atlanta with his wife and two young children.

An image provided by Mr. Gambaryan’s family shows him and his wife, Yuki, at Sequoia National Park in California in 2021.

Binance hired Mr. Gambaryan to work on compliance issues in 2021 and eventually made him the head of its financial crime compliance team.

By the time he traveled to Nigeria, Mr. Gambaryan had become one of the company’s most recognized employees outside its executive suite. He spoke at conferences, used his pedigree as a former law enforcement officer to help recast Binance as a law-abiding financial firm and met with government officials around the world. He liked to recount his years as a criminal investigator for the Treasury Department, where he was part of the team that investigated crimes linked to the Silk Road, a dark web marketplace. His friends and colleagues described him as fearless and proud of his government service.

In early January, Mr. Gambaryan was part of a delegation of Binance employees that traveled to Abuja for meetings with Nigerian officials, who were concerned that the company was evading taxes and violating anti-money laundering rules.

The trip soon turned frightening, six people familiar with it said. On Jan. 8, Binance’s delegation met with a group of Nigerian legislators, who read aloud a list of accusations against the company, including tax violations, three of the people said. The Binance delegation asked how they could resolve the government’s concerns.

Peter Aniekwe, a Nigerian lawmaker who attended the meeting, said in an interview that he and his colleagues told Binance’s employees to speak with the Nigerian tax authority about how much the company owed.

Then one of the lawmakers suggested that the delegation was at risk of detention. “We told them that it’s better to settle or they might not leave Nigeria,” Mr. Aniekwe said.

It was meant to be a casual comment, Mr. Aniekwe said, and not an explicit threat, since legislators have no power to arrest anyone.

Still, the employees were alarmed. That night, a local Nigerian lawyer who was working with Binance told the delegation that the cost of settling the company’s legal problems in Nigeria could exceed $100 million, three people familiar with the talks said.

Fearing for their safety, Mr. Gambaryan and his colleagues cut the trip short and flew out of Nigeria, the people said.

Just a month and a half later, though, Mr. Gambaryan went back.

The decision-making among Binance officials about the return trip was muddled, and it wasn’t clear who made the final call. Friends and colleagues pleaded with Mr. Gambaryan not to go, three people familiar with those discussions said. He responded that he felt a sense of obligation to return, and that he thought he could mend relations with the Nigerian officials, a person familiar with his thinking said.

The debate reached Binance’s top executives, a person familiar with the discussions said. Before Mr. Gambaryan left, Binance received assurances from local officials that he would be safe, the person said, and the company hired a security firm to help him navigate Abuja.

But tensions were growing. A few days before Mr. Gambaryan’s return trip, Bayo Onanuga, an adviser to Nigeria’s president, accused Binance of facilitating trading that had contributed to the collapse of the naira, the country’s currency.

Only one other Binance employee traveled with Mr. Gambaryan — Mr. Anjarwalla, who had also been part of the January delegation. On Feb. 26, they met with officials from Nigeria’s financial regulators and other government agencies. Binance did not send any lawyers to accompany them, a person familiar with the meeting said.

The discussions turned hostile. The Nigerian officials wanted Binance to turn over data for a large swath of its customers, a demand that the company was unwilling to meet, three people familiar with the talks said.

A few hours later, Nigerian officials escorted Mr. Gambaryan and Mr. Anjarwalla to their hotel and ordered them to pack their bags, according to their families. Then they were taken to the guesthouse — a secure compound near the headquarters of Nigeria’s national security adviser. “You’re our guest now,” a Nigerian official told them, according to a person familiar with what happened.

The Nigerian authorities confiscated Mr. Gambaryan’s and Mr. Anjarwalla’s passports, but they were able to keep their phones, allowing them to communicate with family and colleagues. No criminal charges were filed, though a local court issued an order permitting the authorities to detain Mr. Gambaryan and Mr. Anjarwalla pending an investigation.

For weeks, they stayed in a section of the house that included two bedrooms, a living room and a kitchen. Guards holding AK-47s were stationed nearby, a person familiar with the matter said.

Speaking to the BBC in early March, Mr. Onanuga, the presidential aide, said Nigeria’s government was demanding close to $10 billion from Binance “in retribution because they really messed up our economy in a very short time.” (In an interview with The New York Times, Mr. Onanuga said he had meant that Binance “may” have to pay such an amount, and that he had been speculating about the size of a potential fine.)

On March 22, lawyers for Mr. Gambaryan and Mr. Anjarwalla learned that Nigeria was preparing to charge the two men personally with criminal violations, as part of its case against Binance, according to their families. The next morning, Mr. Gambaryan woke up to discover that Mr. Anjarwalla was missing, a person familiar with the matter said.

How Mr. Anjarwalla managed to escape was unclear. A local newspaper reported that Mr. Anjarwalla, who has dual nationality in Kenya and Britain, had used his Kenyan passport to leave Nigeria after handing over his British one. The guards led him to a nearby mosque for Ramadan on March 22, the report said, before he somehow slipped away.

A representative for Mr. Anjarwalla said he left Nigeria “by lawful means.” A spokesman for Nigeria’s national security adviser said the country’s security agencies were working to obtain an international arrest warrant for him.

“The personnel responsible for the custody of the suspect have been arrested,” the spokesman said.

After the escape, the Nigerian authorities confiscated Mr. Gambaryan’s phone. On March 25, he, Mr. Anjarwalla and Binance were charged with money laundering, tax evasion and other crimes. A judge ordered Mr. Gambaryan to be taken to Kuje, where the Islamic State staged a dramatic prison break in 2022 to free hundreds of its fighters.

Mr. Gambaryan’s family, friends and colleagues have been lobbying U.S. officials to secure his release. “They need to make it clear that this kind of injustice should not be tolerated,” Mr. Gambaryan’s wife, Yuki, said in an interview.

A White House official, who requested anonymity to discuss sensitive diplomatic issues, said the administration was working with the U.S. embassy in Nigeria to resolve the situation.

Mr. Gambaryan has lawyers representing him in Nigeria and is scheduled to appear in court for a bail hearing on Monday, a spokeswoman for his family said. Before he was taken to Kuje, Mr. Gambaryan recorded a video of himself in the courtyard of the guesthouse.

“Guys, I’ve done nothing wrong,” he said. “I’ve been a cop my whole life. I just ask the Nigerian government to let me go.”

Julian Barnes and Ruth Maclean contributed reporting.

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