US wants Binance founder Zhao to serve three years in jail
After pleading guilty to breaking laws against money laundering, US prosecutors want Changpeng Zhao, the founder and former CEO of Binance, the largest cryptocurrency exchange in the world, to serve three years in jail.
The motion was made by prosecutors in a federal court filing in Seattle on Tuesday night.
According to them, sending Zhao to prison for twice as long as the maximum 18 months suggested by federal guidelines would be appropriate given the seriousness of his willful crimes and would convey the message that “the right choice, every time, is to comply with the law.”
Zhao’s attorneys asked for probation. Zhao is scheduled to be sentenced by US District Judge Richard Jones on April 30.
Zhao, 47, who was once the most influential person in the cryptocurrency space, resigned as CEO of Binance in November of last year after the exchange and he both acknowledged that they had violated the Bank Secrecy Act’s anti-money laundering regulations.
Binance consented to a criminal fine of $4.32 billion.
Prosecutors said that Binance failed to disclose more than 100,000 suspicious transactions with recognized terrorist organizations, including as Hamas, al Qaeda, and the Islamic State of Iraq and Syria, or ISIS, because it followed a “Wild West” style that promoted illegal activity.
They said that Zhao’s platform received a large share of the money made from malware and encouraged the selling of goods that glorified child sex assault.
“He made a business decision that violating US law was the best way to attract users, build his company, and line his pockets,” according to prosecutors.
Zhao’s attorneys asked for mercy, pointing to the first-time offender’s “unflinching” admission of guilt, his $50 million criminal penalties, and the fact that no jail sentence had been imposed in a case even slightly similar to Zhao’s.
According to them, Zhao turned Binance into a compliance leader in the sector “despite the initial failures that led to this prosecution.” In 2017, Zhao established Binance.
He agreed not to appeal any sentence that falls within federal standards in exchange for his freedom on a $175 million bail.
A criminal fine of $1.81 billion and $2.51 billion in restitution were part of Binance’s sentence. According to Zhao attorneys, he also paid $50 million to the US Commodity Futures Trading Commission.
US v. Zhao, US District Court, Western District of Washington, Case No. 23-cr-00179, is the matter at hand.
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