Former Binance CEO Restricted to U.S. Stay Amid Guilty Plea on Money Laundering Charges
Former Binance CEO Changpeng Zhao is required to remain in the United States following a federal judge's decision on Monday, subsequent to Zhao pleading guilty to violating U.S. anti-money laundering laws. The founder of the world's largest cryptocurrency exchange stepped down from his role last week, admitting guilt for willfully causing Binance to fail in maintaining an effective anti-money laundering program.
U.S. District Judge Richard Jones in Seattle stated that Zhao's stay in the United States would be reevaluated concerning his sentencing hearing in February. Zhao, a citizen of the United Arab Emirates (UAE) and Canada, may potentially be allowed to return to the UAE, pending the court's decision. The judge's review was prompted by the U.S. government's appeal against a previous decision that permitted Zhao to go back to the UAE before his sentencing. As part of his bail agreement, Zhao agreed to a $175 million bond.
Binance Holdings, the cryptocurrency exchange's parent company, agreed to pay over $4.3 billion and pleaded guilty to violating U.S. anti-money laundering and sanctions laws. Despite the legal developments, Binance emphasized its commitment to enhancing safety and security.
Zhao, acknowledging his mistakes, faces a maximum prison sentence of 18 months under federal guidelines and has agreed not to appeal any sentence up to that length. The U.S. government will decide on the recommended jail time closer to Zhao's sentencing in February.
While the U.S. lacks an extradition treaty with the UAE, Zhao's lawyers argue against him being a flight risk, citing his substantial bail payment and voluntary acceptance of responsibility by coming to the U.S. The U.S. Securities and Exchange Commission (SEC) is investigating Binance.US for potential control over customer assets, similar to FTX, as reported by the Wall Street Journal on Nov. 27. The SEC had previously filed a lawsuit in June against Binance and Binance.US, alleging the exchange's involvement in the sale of unregistered securities and accusing Zhao and Binance of various legal violations.