Binance Agrees to $4 Billion Settlement and CEO Pleads Guilty to Money Laundering Charges

Binance CEO Changpeng Zhao

The U.S. government has reached a settlement with Binance, the world’s largest cryptocurrency exchange, in which the company will pay a roughly $4 billion penalty. Binance’s founder and CEO, Changpeng Zhao, pleaded guilty to a felony related to his failure to prevent money laundering on the platform. As part of the settlement, Zhao has stepped down as the company’s chief executive.

The settlement comes after Binance admitted to violations of the Bank Secrecy Act and apparent violations of sanctions programs, including its failure to implement reporting programs for suspicious transactions. U.S. Attorney General Merrick Garland described the settlement as one of the largest corporate penalties in the nation’s history and emphasized that using new technology to break the law is considered criminal behavior.

Under the terms of the settlement agreement, Binance will be subject to five years of monitoring and significant compliance undertakings. The U.S. Treasury has also stated that Binance must ensure its complete exit from the United States.

U.S. Treasury Secretary Janet Yellen highlighted that Binance processed transactions by illicit actors, supporting activities ranging from child sexual abuse to illegal narcotics and terrorism. Binance failed to file suspicious activity reports on these transactions and allowed over 1.5 million virtual currency trades that violated U.S. sanctions.

Changpeng Zhao’s sentencing is scheduled for February 23, although it may be delayed. He faces a possible guideline sentence range of up to 18 months. Zhao’s attorney, Mark Bartlett, noted that Zhao had been aware of the investigation since December 2020 and voluntarily surrendered himself.

Binance has acknowledged its responsibility for historical criminal compliance violations and stated that it made misguided decisions as it rapidly grew to become the world’s largest crypto exchange.

It is worth noting that the cryptocurrency industry has faced scandals and market meltdowns in recent years. Zhao’s rival, Sam Bankman-Fried, the founder of FTX, was convicted earlier this month of fraud for stealing at least $10 billion from customers and investors.

Author: CrimeDoor

Leave a Reply

Share on:

[mailpoet_form id="1"]

Subscribe to Our Newsletter