The Department of Justice (DOJ) has reevaluated and decided that Sullivan & Cromwell is not suitable for the monitoring role due to its past work with FTX. Sharon Cohen Levin, a partner at Sullivan & Cromwell, has been appointed as the leader of the monitoring team for Binance. A class-action lawsuit implicates Sullivan & Cromwell in an $8 billion fraud involving FTX, raising concerns about their negligence.

The DOJ intended to choose Sullivan & Cromwell as an independent monitor for Binance, but changed course due to their association with FTX, Binance's competitor. This monitoring is crucial for addressing Binance's violations of anti-money laundering and sanctions laws and may last between three to five years.

Bloomberg News reported the DOJ's caution about potential conflicts of interest as Sullivan & Cromwell serves as FTX's bankruptcy attorney. This scrutiny occurred at a critical time when Sullivan & Cromwell had to ensure Binance's compliance with U.S. regulations. Sharon Cohen Levin, a former federal prosecutor, was selected to head the monitoring team for Binance.

Despite FinCEN's support for Sullivan & Cromwell, DOJ is still undecided about their appointment. The firm's expertise in financial litigations and monitoring entities makes them a strong candidate for the monitorship role. However, a class-action lawsuit against Sullivan & Cromwell by FTX investors alleging negligence in an $8 billion fraud complicates the decision-making process.

The U.S. bankruptcy judge's approval of an investigation into potential conflicts of interest at Sullivan & Cromwell further complicates the situation. Prosecutor Robert J. Cleary leads the probe to ensure transparency and legality in the firm's financial cases. The cryptocurrency industry's need for transparent and strict regulatory oversight is highlighted by this dispute and needs to be addressed by regulatory authorities like the DOJ and FinCEN.

The final decision on Sullivan & Cromwell's appointment as Binance's monitor is uncertain as the DOJ explores other candidates. The integrity of the enforcement process will be a crucial factor in determining the monitorship appointment.