A US judge recently sanctioned Binance, the world’s leading cryptocurrency exchange, to settle over US$4.3 billion in penalties due to infringements of federal anti-money laundering and sanctions regulations. These penalties stem from failures in the exchange’s internal monitoring systems.
The judgment, passed by US District Judge Richard Jones in Seattle, encompasses a US$1.81 billion criminal fine along with US$2.51 billion in forfeitures. This decision came shortly after federal prosecutors sought amendments to the bond conditions of Binance founder, Zhao Changpeng, sparking a challenge from Zhao’s legal representatives.
This legal action concludes an extensive investigation into Binance, revealing the platform’s negligence in reporting over 100,000 dubious transactions. These transactions were linked to entities identified as terrorist groups, such as Hamas, al Qaeda, and the Islamic State of Iraq and Syria (ISIS), as per the prosecutors’ findings. Additionally, Binance’s platform was implicated in facilitating the sale of child sexual abuse materials and was identified as a major recipient of funds from ransomware attacks.
In response to the court’s decision, Binance acknowledged its accountability and reported significant enhancements in its anti-money laundering measures and customer verification processes. The company also stated its commitment to adhering to the stipulations of its plea agreement, indicating substantial strides towards compliance.
Zhao, who had previously admitted guilt to money laundering charges, has been residing in the United States under a US$175 million bond. His plea agreement, which includes a US$50 million fine, also necessitates his resignation from the CEO position at Binance.
The proposed adjustments to Zhao’s bond, as put forward by the prosecutors, aim to align with Judge Jones’s directive that Zhao remain within the continental US under the surveillance of court officers until his sentencing scheduled for April 30. The revised bond conditions would require Zhao to give a three-day notice for any travel plans, surrender his passports, and retain his current residence unless a change is authorized. Additional recommendations from pretrial service officers suggest that Zhao should be subjected to location monitoring.
Despite multiple discussions between the prosecutors and Zhao’s legal team regarding the bond modifications, Zhao’s lawyers have expressed opposition to the motion as currently drafted. Further comments from Zhao’s legal representatives were not immediately available.
