Experts expected that the Binance founder and former CEO would, in any case, face a prison sentence due to the seriousness of the offenses. U.S. prosecutors have recommended a 36-month prison sentence for Changpeng Zhao (CZ), the former mastermind behind the world’s largest crypto exchange. This recommendation was made in a recent court filing, with the sentencing scheduled for April 30 in Seattle.
As part of the $4.3 billion settlement with the U.S. authorities in November 2023, CZ was forced to step down from his role as CEO of Binance following his guilty plea to charges related to money laundering violations. Along with Zhao’s resignation, Binance admitted to these violations and agreed to a substantial financial penalty of $4.32 billion.
U.S. prosecutors have alleged that Binance, under the leadership of CZ, also owes its leading position to its support of cybercrime and terrorist activities. In fact, according to the findings of the U.S. authorities, Binance must be qualified as a cybercrime organization.
Binance became the world’s largest cryptocurrency exchange in part because of the crimes it committed – now it is paying one of the largest corporate penalties in U.S. history.
Attorney General Merrick B. Garland (link)
The severity of the sentence proposed by the prosecutors reflects the gravity of the violations, highlighting Zhao’s deliberate non-compliance with U.S. laws. “Given the magnitude of Zhao’s willful violation of U.S. law and its consequences, an above-guidelines sentence of 36 months is warranted,” stated the U.S. prosecutors in their submission to the U.S. District Court for the Western District of Washington. Although federal sentencing guidelines suggest a maximum of 18 months for such offenses, CZ had previously agreed not to appeal any sentence up to that length. Currently, he remains free in the U.S. on a $175-million bond.
Further intensifying the case against Binance, U.S. authorities have reported that the exchange failed to report over 100,000 suspicious transactions linked to designated terrorist organizations, including Hamas, al Qaeda, and ISIS. Additionally, the platform has been implicated in supporting transactions involving child sexual abuse materials and receiving significant amounts of ransomware proceeds.
