The United States Financial Crimes Enforcement Network (FinCEN), which is a division of the Treasury Department, has claimed that there is a connection between Binance and the illegal cryptocurrency site Bitzlato.

In an order made public on Jan. 18, FinCEN noted that the cryptocurrency exchange known as Binance was among Bitzlato’s “top three receiving counterparties” when it comes to Bitcoin (BTC)-related transactions.

Binance was reportedly one of the largest counterparties to receive Bitcoin from Bitzlato between May 2018 and September 2022, as stated by the regulator.

FinCEN noted that other counterparties included the dark web marketplace Hydra, which had connections to Russia, and the alleged Ponzi scam operating in Russia under the name “Finiko.”

However, FinCEN did not include Binance in its list of the top three issuing counterparties in the order.

According to the document, the three companies Hydra, Finland-based exchange LocalBitcoins, and Finiko were the largest Bitcoin contributors to Bitzlato between May 2018 and September 2022. According to what FinCEN said in the order, around two-thirds of the top of Bitzlato receiving and issuing counterparties are linked with darknet markets or frauds.

The agency said that between 2019 and 2021, Bitzlato collected cryptocurrencies totaling $406 million through fraud, $224 million from dark web markets, and $9 million from ransomware perpetrators.

The disclosure comes at a time when many agencies in the United States have launched serious enforcement actions against Bitzlato. These authorities accuse the company of engaging in money laundering and allegedly allowing the circumvention of sanctions against Russia.

Anatoly Legkodymov, the creator of Bitzlato, was arrested by the Federal Bureau of Investigation on January 17 in Miami as part of the ongoing investigation into the company.

Bitzlato was a cryptocurrency service that was not widely recognized, in contrast to major cryptocurrency exchanges like Binance and Coinbase.

The platform is said to have been established in 2016 and had an office in the Federation Tower skyscraper in Moscow, where it processed transactions of at least one hundred thousand dollars.

The fact that Binance was allegedly involved in the Bitzlato case raises some concerns about the activities of the exchange, as well as possible relations with Russia.

As previously reported, Binance was one of the exchanges that made the decision to continue serving the unsanctioned Russians after the adoption of the eighth package of sanctions by the European Union against the nation.