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I have heard that some scammers are making fake accounts on Binance for P2P and using hacked bank accounts for transfer. If we deal with them for P2P deals, our bank accounts can also get feezed. Have you ever faced this problem on Binance ? How can we reduce the chances of getting affected by this ?

It has not happened to me, but I posted about it some weeks ago. You can read it from these link: You data is not safe on centralized exchanges (https://bitcointalk.org/index.php?topic=5469879.msg62974201#msg62974201)

This happened in Hong Kong but it can also happen at anywhere in the world. It is an effective way to steal from someone's bank account.

What that is most important is to avoid giving your identity documents to people. Those sites too can misuse your identity documents that you submitted to them.

I would imagine that someone using the method you mentioned would get caught quickly. I mean, for how long could someone use a bank account account that's not his? Regardless though, you can try to reduce the chances of dealing with such individuals by:

1. Dealing with individuals who have a lot of feedback.
2. Merchants (because they have to go through advanced verification).
3. Refuse to deal with anyone who has a Binance account with a different name than the bank account's name. A lot sellers would ask if you're okay with them sending funds from "their partners/friends account".

I'm not a big fan of Binance when it comes to P2P so I haven't gotten this experience but since the exchange is very popular in my country, I have heard countless stories of it happening to my country men especially on twitter. Binance is very popular so there'll always be scammers looking to take advantage of newbies just registering on the exchange to trade. In addition to what others have said, I'll suggest if you must use Binance centralized P2P you should go through their guideline as they have it on their platforms and follow up what they said to avoid becoming a victim to P2P scams. You can't save yourself from receiving stolen funds but you can reduced the risk of that happening by;

• Avoiding high rate sellers/buyers and only trade with verified merchants Scammers are known for using high rate to attract victims.
• Avoid offline transaction, scam marchants are known for trying to take customer off the official exchange platforms then they can trade with you with stolen coins or fiats.
• Avoid transaction from third party accounts, OmegaStarScream already emphasize on that.
• Also don't accept payment from multiple account and report any suspicious activity to Binance exchange customer care to have evidence when the authorities comes knocking on your door.

Stolen funds will always be sent from a different account from that of the user you're trading with, so report such activities when you encounter them irrespective of the exchange you're using to trade P2P.

Hacked bank accounts ? How ? If anyone has hacked a bank account, he would rather withdraw the money rather than spending it slowly to pay for the P2P deals. Wouldn't the original owner get notified that a transaction is made from his bank account without his knowledge ???

Anyways. in case this happen in some part of the world, it is better to deal with verified merchants. You may find non-verified merchants rates a bit more attractive, but it is not worth taking the risk.

One more thing which i personally follow is that do not make a single big P2P deal. If you want to have a transaction of 1000 dollars (example) better do it in parts so that your capital is less exposed to risk in case any mishap happens.

There is a great risk of being in trouble when doing P2P that includes personal data, third party accounts may be involved in money laundering crimes, for example, it happened to a friend, he was called to testify in an extortion case.

The account they used to make the transfer to their Fiat Bank account for the sale of cryptocurrencies, it received funds from a kidnapping crime, and when they tracked it down, they became involved him.

He had to go to testify and verify that it had nothing to do with the crime that was being attributed to him.

It is dangerous, if you need to sell crypto to carry Fiat Local*, it is preferable that you buy/sell to Binance, and not from a third party of verified sellers.

^{*Binance allows buying and selling and subsequently making Fiat deposits from the platform to your account, but not all countries}.

OP refers to P2P transactions, in reality doing KYc on Binance is already complicated, imagine giving personal data to a supposed seller on a platform that the only thing that attributes to them is something like a verified seller.

Usually, if you follow Binance p2p guidelines to the letter, you should be fine. One of the guidelines/rules is that you should not release the coins if the bank account details doesn't match with the buyer's details. The buyer's name must be the same as the name of the person who sent you the money.
Scammers always come up with new tricks. Therefore, you need to be vigilant and don't be tempted by high rates offers.

From the beginning Binance launched the P2P Feature I have been using it until now and no fraud has occurred.

Maybe it's just a transaction that is not processed because some sellers make the price cheaper just to attract attention,
but don't process it or the Merchant makes a price input error.

If you follow the Binance P2P guidelines correctly, there will be no chance of being scammed.
Those who are scammed are usually released immediately without seeing valid proof in the bank account whether the funds have been received or not.
Scammers will only send fake proof and urge them to be released immediately.

Whatever it is, make sure to choose a merchant with a lot of transactions with 90%-100% accuracy and a lot of positive feedback.
Those who are the best merchants will provide a fast response and will make appropriate payments.

I've used the Binance P2P service and I've not had any challenges but that doesn't mean there are no scammers. A user can get his account frozen by unknowingly trading with a fraudster who's laundering money through the exchange and possibly looking for a way to hide the stolen funds by trading with innocent users. Sadly, one of the setbacks of P2P trades is that you don't know who you're transacting with and the source of the person's funds and I doubt if there's anything can be done to mitigate this risk.

I find this topic very interesting, you can read it up and get more information.

 Solution to bank account frozen by cyber police due to P2P trade. (https://bitcointalk.org/index.php?topic=5349166.0)

But if you do not give identity documents in these big websites or exchanges, they will put limit or restrictions on your account. Even to do P2P transactions on Binance, some sellers and buyers demand identity documents and they will deny the deal without these documents.

I think he meant about the other end that you're trading with, the other person but not the exchange. Although it's also true that these exchanges might misuse our identities and they'd say a guarantee that all of our data are safe with them. @OP, I've seen a lot of deals in Binance P2P transactions and just as what khaled said about following the guidelines, you'll have no problem. Because there were some cases that the other end is gonna try to rush you just for you to send him the payment without even verifying that they've already sent you what you're trading to them. Don't be in a hurry there because you'll never know the new tactics of fraudsters and scammers there but yeah, the platform is legit but it can be misused and abused by these cons.

I think I did not put it the way I supposed to, but you are right, I was not talking about the exchange but about fake sites and ways unscrupulous people are demanding and collecting people's personal identity documents and using it in a wrong way to get verified. If you read the link that I have above, you will see how it works. The scammers use the victim identity to register on Binance and also send money from the victim bank account.

No, I've never had that problem before and I don't expect it to happen because it's a loss for me.
We can only check their status by looking at the profile on their account and how many transactions they have made and what reviews there are from people who have transacted with them.
If everything is good, you can continue transacting with them but don't immediately make large transactions. But try withdrawing small amounts of money while seeing how they respond to their customers.
You need to read the instructions provided by Binance to reduce the risk of fraud and not release the coins before the merchant sends the money to your account.

Yeah, it's happening but in case of Binance P2P, they won't ask that much as long as you're dealing with verified merchants. But somewhere in other markets and platforms like there's no actual platform and only direct P2P, it's best not to give any details like your identity.

On this case, this is true that scammers can register the stolen data/identity of other people. And that's why only deal with huge percent of completion or trade histories say on Binance P2P.

Making fake accounts on Binance It is not as easy as making fake accounts here or on social media. All accounts in Binance P2P are KYCed accounts, and there is a trust record. If the user scam you, you can leave a rating.

• Only deal with users who have a lot of feedback
• Read the negative feedbacks and whether they are related to scam
• Read the account's comments to these feedbacks
• Do not provide your personal data, only the account number and your full name
• Start trading with small amounts, and with days you can increase them.

You may be scammed once or twice, but you will not always be scammed and learn from your mistakes.

I don't use Binance but I think what they do is steal the data of other people and use it for their Binance account. They use the details of that victim to create a fake account that they use to scam other people.
I don't think that account can be verified though, that is why it's always advisable to only deal with verified accounts, not like it's 100% secure, but it's better.
We just have to be careful of how and where we drop our personal documents because we do not know what they can be used for.
Centralized exchanges carry too many risks.

Yes, there's a very high likelihood of fraud.
Why would someone that has access to binance.com with a verified account want to trade in P2P? It's not unlikely that ill gotten funds are utilized to complete these transactions and could potentially get the receiving party's account flagged or even transactions charged back. So I'd say avoid it unless it's one of your last options. Also go by feedback and not best price if you do.

Yeah, scammer would probably be able to use victim's bank account once or may be few times but deed is done, no? Also, scammers would likely have multiple such accounts lined up.

Something similar happened to me few years ago, this was the process:

Scammer creates a buy order, they have unsuspecting victim lined up with his bank details who is going to send money to seller or scammer sends it themselves if they got the access, scammer sends the money from victim's bank account, seller confirms that he received the money and p2p platform gives up the custody of coins because seller gave the confirmation that he received the amount, scammer gets the coins. Now, after few days seller gets chargeback from the victim's bank account that he was duped into sending money, seller loses the coins and his money received also gets freezed.

This is exacty what happened to me few years ago. It wasn't binance p2p but local p2p exchange.

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My colleague frequently deals on binance p2p, his tip is, stick to reputed buyers/sellers even tho rates might be less. Scammers lure often by greed.

Yes, it could be an early indication of a scammer trying to set a trap and then report the order.
But you need to know that every time you transact in P2P, make sure to see whether the balance has been sent or not to the account,
if not, never press the Release button.
When nothing is sent until the payment time expires you can report the merchant and give negative feedback.

That's obvious thing but If you were scammed, what will happen is that even if you did press release button only after receiving the funds, you will get chargeback and 0 funds for selling your coins. If something like this happens to you, do remember to give that buyer negative feedback so others don't get scammed as you did.

Seeing again how much the transaction is made, don't forget to look at the feedback first, if the feedback is 0 or even negative,
then don't do the transaction to be safer.

If it has already happened and you haven't received payment, do negative feedback to report to the Exchange platform,
they will definitely respond and will do what they can do.
They also have complete data and can detect who the scammer is.

There's a possibility that your funds could be frozen if the authorities decide to investigate, but, of course, it won't affect you if you're not involved in any illegal activities. P2P transactions are pretty straightforward – you trade cryptocurrencies for fiat with a specific person. In reality, though, it's often unclear where the funds are coming from.

So, I believe the main responsibility falls on the exchange. They need to make sure they thoroughly verify the information provided, cross-check the documents, and only approve KYC for accounts once they're sure everything checks out. Once an account is verified, it's no longer the exchange's responsibility. If there's an investigation, the exchange might cooperate with the authorities. So, if you're using P2P and funds from the other party come from illegal sources, you should be in the clear unless you're in colluding with them.

I use P2P regularly myself, and I'm not particularly worried about this kind of scenario.

That depends on exchange again, platform I was scammed on was local p2p exchange, they couldn't do much about it and eventually shrugged off. I dunno how much and what data binance p2p asks.

It must be because they manage the platform.
But to be investigated in detail by the exchange itself and the authorities to freeze funds in the account, there must be a large enough transaction.

If the transaction is under $100, it probably won't get any response and will be a less complicated internal resolution.
And it also depends on how many people report fraud on the same suspect.

Local exchanges will usually be more concerned about fraud.
At my local exchange, there was a hack on an account used by a customer, but it didn't get a serious response initially,
but when it was brought up to the media they did investigate, and the hacker was caught.

The point is that local p2p will usually respond more quickly if there is a lot of pressure so that the case will be investigated.

This is true because there’s a story like this on our local board which one member made a transaction to a certain P2P vendor that use funds from hack bank account. The bank freeze his assets and require him to submit supporting details to back up all his transactions.

It’s really pain in the ass if you manage to made a deal on one of them since banks is centralized which means they are connected to each other that makes it easy to trace and freeze an account if tainted fiat landed on your account. It’s general rule on P2P to never trade on 3rd party account that has a different name to Binance account.

Well the thing is there was blanket ban on cryptocurrency trading back then, banks were ordered by central bank to not do business with crypto individuals. Hence, people were forced to use p2p, now things have gotten somewhat better as ban has been lifted and people can trade normally, somewhat cause now there is 30% tax on crypto earnings, lol.

Obviously, no one's going to bother hacking an account for just $100. Hackers usually go after big sums of money that they can launder through exchanges. The only real defense the exchange has is to freeze the account, but that's only effective if the authorities act swiftly to trace the money trail. Binance, in particular, is known for its speed – trades can happen in mere minutes, whether it's through P2P or the regular channels.

Prohibition is the bottleneck of everything, when crypto is not supported then it's the user's problem entirely.
But when it starts to be accepted again but with a crazy tax rule of 30%, it's just like robbing crypto users,
to hell with the fucking tax that the government gives like that.
They are just like loan sharks who just want to blackmail crypto users.

I'm not talking about hacking your account, I'm talking about P2P scams that scammers can do.
Who would hack an account with a balance under $100.
The authorities will only prosecute cases with fraud amounts of thousands or even hundreds of dollars. 

I think you got him wrong. To use the Binance p2p platform you don't have a choice, you must verify your identity before you can start using it. So, this is not a choice. You either comply with it or find another p2p platform.
On binance p2p, merchants don't have the right to ask you for your personal documents since Binance has already verified them. Any merchant who asks for such docs or any other personal information is mist likely a scammer and better avoid dealing with him. If he refuses to complete the deal then simply report him and binance's customer service will take care of the rest.

That situation is possible but I doubt scammers can make fake accounts right away that easily and will use hacked bank accounts. There are lots of verifications needed on Binance P2P before becoming a merchant. Aside from that, there's no way we can avoid that if we really encounter a trade with a compromised bank account.

How to reduce the chances of getting affected by that?

a) only select merchants and do trade to only those with 99% positive ratings

b) stop using Binance P2P

I did a P2P transaction with "Coingraam" due to difficulty getting GBP off Binance. With a goodish rating, over 1400 trades and several years of activity and verified, I assumed it would be ok. A few days later I received a text message from Lloyds saying my account had been used to receive fraudulent transactions and they'd be closing my account.

I reported this to Binance a few days ago and Coingraam is still happily trading on there, so Binance doesn't seem too fussed.

So I'd say yes, there is a high rate of fraud with Binance P2P. Don't use it.