U.S. prosecutors have requested the court to implement more stringent bond conditions for Changpeng Zhao (CZ), the disgraced billionaire founder of Binance, as he awaits sentencing in April for violations of a federal anti-money laundering statute. The adjustments to Zhao’s bond terms, should they be approved, would necessitate the surrender of his Canadian passport and obligate him to notify prosecutors at least three days prior to any domestic travel.
CZ, who has been one of the most prominent figures in the crypto sector, pleaded guilty in late November to charges of failing to maintain an effective anti-money laundering program in contravention of the Bank Secrecy Act. Concurrent with his guilty plea, Zhao resigned from his role as CEO of Binance. Zhao’s sentencing could result in up to 18 months in prison according to federal guidelines, although there is speculation that prosecutors may advocate for a more severe sentence.
Read our stories about Changpeng Zhao here.
The proposed modifications to Zhao’s bond conditions are intended to closely regulate his movements and prevent the possibility of flight, given his substantial wealth and limited ties within the United States. This comes after Judge Richard Jones previously restricted Zhao’s international travel, citing the risk posed by his considerable assets and residency in the United Arab Emirates. In a letter to the court dated December 22, Zhao had requested permission to travel to the UAE for personal reasons. However, this request was denied on December 29.
Prosecutors’ filings in the U.S. District Court in Seattle reflect recommendations from pretrial services to limit Zhao’s travel to the western district of Washington and the district of his current residence. Additionally, the inclusion of a “location-monitoring condition” has been suggested, although the filing stops short of directly requesting the judge to enforce this measure.
Zhao’s legal representation has expressed opposition to the proposed bond conditions. Attempts to reach Zhao’s attorney for comment have been made, but there has been no immediate response.
As part of his plea agreement, Zhao has agreed to a personal fine of $150 million to the U.S. Commodity Futures Trading Commission (CFTC). This is in conjunction with Binance’s agreement to pay over $4.3 billion in penalties to resolve various federal charges, described as “one of the largest corporate penalties in U.S. history.”
This case continues to unfold, drawing attention to the legal responsibilities of cryptocurrency platforms and their executives to adhere to U.S. anti-money laundering regulations. The outcome of Zhao’s sentencing may set a significant precedent for the cryptocurrency industry and its regulatory environment moving forward.
