A US federal judge has approved Binance's guilty plea and $4.3 billion fine settlement agreement. This agreement relates to violations of anti-money laundering (AML) regulations and sanctions through their cryptocurrency exchange platform .
Details of Agreements Made
The US Department of Justice (DOJ) announced this agreement last November. Binance was accused of violating the Bank Secrecy Act (BSA), the International Emergency Economic Powers Act (IEEPA), and failing to register as a money transfer business.
Additionally, the DOJ accused Binance founder and former CEO, Changpeng “CZ” Zhao , of neglecting to implement an effective AML program on their platform, thereby violating the BSA.
This deal comes after a years-long investigation by the DOJ into the leading crypto exchange platform.
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Impact of the Agreement
Prosecutors stated that CZ's failure to implement an AML program on Binance allowed money to flow to terrorists, cybercriminals and child abusers through their platform.
As part of the deal, which prosecutors called the largest corporate settlement, Binance agreed to pay a $2.5 billion fine and $1.8 billion in criminal penalties, bringing the total to $4.3 billion. They also agreed to use independent compliance monitors for three years and improve their AML programs.
CZ, on the other hand, pleaded guilty to money laundering offenses and was released on $175 million bail. As part of his deal, he paid a $50 million fine and stepped down as CEO. Since then, CZ has remained in the US because he is prohibited from returning to his residence in Dubai.
Prosecutor Seeks to Change CZ's Bail
In the latest court hearing on Friday, federal prosecutors sought to change CZ's bail. The changes include requiring CZ to notify authorities three days in advance if he plans to travel, surrender all his passports, and maintain his current residence in the US, unless he receives approval to move.
In addition, pre-trial service officers asked CZ to have his location monitored.
CZ's sentencing hearing is scheduled for April 30. Although an appointed judge will determine his sentence, prosecutors believe he could be jailed for 18 months for his crimes.
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About the Changpeng Zhao Case
Zhao previously pleaded guilty in November to charges related to failing to maintain an effective AML program, which led to his resignation as CEO of Binance.
Authorities argued that travel and other restrictions were necessary to ensure Zhao's compliance. However, his legal team opposed the proposal.
Under current bail conditions, Zhao needs to notify prosecutors and pre-trial services at least three days before domestic travel.
The new conditions also require the surrender of Zhao's current Canadian passport and any previously expired passports. He is also prohibited from obtaining a new passport without court approval. Any change of residence also requires prior approval.
In December, a judge banned Zhao from traveling outside the United States due to concerns over his vast wealth and limited ties to the country, which he deemed a flight risk.
Zhao's request to visit the United Arab Emirates (UAE) for a family emergency was rejected in late January.
Binance, the world's largest cryptocurrency exchange platform, has agreed to pay more than $4.3 billion to settle federal charges, marking one of the largest criminal fines ever imposed in the United States.
The cryptocurrency community is closely watching developments surrounding one of the most influential figures in the industry. A verdict in April will have significant implications for CZ and cryptocurrency regulation as a whole.
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Also Read:
Changpeng Zhao's Sentencing Trial Postponed, Why?
Sentencing Trial of Changpeng Zhao, Binance Founder, Postponed! Here's the explanation
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DISCLAIMER : This article is informational in nature and is not an offer or solicitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.
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