Binance's Founder, Changpeng Zhao, has been sentenced to four months in prison after pleading guilty to charges related to allowing money laundering on the cryptocurrency exchange, the Financial Times reported. The sentence, handed down in a Seattle federal court, marked a significant development in the ongoing legal battles involving Binance and Zhao.
Plea Deal and Sentencing
Zhao's sentencing occurred after he struck a deal with the U.S. government in November to resolve a longstanding investigation into Binance. As part of the settlement, Zhao agreed to step down as the exchange's CEO.
The sentence issued is less severe despite federal prosecutors seeking a three-year prison term. The defense had advocated for five months of probation, while sentencing guidelines suggested a term of 12 to 18 months. Zhao was convicted of willfully failing to implement effective anti-money laundering programs on Binance as required by the Bank Secrecy Act.
Additionally, he is convicted of allowing Binance to process transactions involving proceeds of unlawful activity, including those between Americans and individuals in sanctioned jurisdictions. As part of the resolution, Binance was ordered to pay $4.3 billion in fines last year. Zhao agreed to personally pay a fine worth $50 million.
Binance’s former chief Changpeng Zhao sentenced to 4 months in jail https://t.co/vySulvvr7W
— Financial Times (@FT) April 30, 2024
Pending Legal Battles
Beyond Zhao's sentencing, Binance faces other legal challenges. The exchange was separately sued by the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) over allegations of mishandling customer assets and operating an illegal and unregistered exchange in the US.
Early this year, a federal judge rejected Zhao's request to travel to the United Arab Emirates. The judge denied the plea due to concerns about flight risk despite Zhao offering substantial collateral, including his equity in Binance.
Meanwhile, the Securities and Exchange Commission (SEC) of the Philippines recently took action against Binance. According to the regulator, the leading crypto exchange has continued to operate without the required license despite warnings dating back to November 2023. The SEC's action includes a formal request to the National Telecommunications Commission to block Binance's website and associated web pages.
Binance's regulatory woes are not limited to the Philippines. Regulatory bodies worldwide have intensified scrutiny of the exchange's activities, citing investor protection and compliance concerns. Binance has encountered regulatory hurdles from France to Nigeria, comprising warnings and lawsuits.
This article was written by Jared Kirui at www.financemagnates.com.
You can get bonuses upto $100 FREE BONUS when you:
💰 Install these recommended apps:
💲 SocialGood - 100% Crypto Back on Everyday Shopping
💲 xPortal - The DeFi For The Next Billion
💲 CryptoTab Browser - Lightweight, fast, and ready to mine!
💰 Register on these recommended exchanges:
🟡 Binance🟡 Bitfinex🟡 Bitmart🟡 Bittrex🟡 Bitget
🟡 CoinEx🟡 Crypto.com🟡 Gate.io🟡 Huobi🟡 Kucoin.
Comments