U.S. Prosecutors Seek 36-Month Sentence for Ex-Binance CEO
U.S. prosecutors are seeking a 36-month sentence for former Binance CEO Changpeng Zhao, citing the severity of his crimes and the need for adequate deterrence. The recommended sentence is above the advisory guidelines range of 12-18 months, reflecting the unprecedented scale of financial crime committed under Zhao’s leadership.
Zhao stepped down as Binance’s CEO in November last year after reaching a plea deal with the U.S. Department of Justice. He is accused of willfully failing to implement an effective anti-money laundering program and allowing Binance to process transactions involving unlawful activity, including those with individuals in sanctions jurisdictions.
Prosecutors argue that Zhao’s actions demonstrate a deliberate disregard for Binance’s legal responsibilities and that he operated the exchange on a “Wild West” model, betting that he would not get caught. The U.S. has also accused Binance and Zhao of violating the U.S. Bank Secrecy Act and sanctions on Iran, ordering Binance to pay $4.3 billion in fines and forfeiture, with Zhao agreeing to pay a $50 million fine.
The sentencing memorandum filed with the court for the western district of Washington emphasizes the need for a higher sentence to reflect the gravity of Zhao’s crimes and promote respect for the law. The official sentencing is expected to take place on April 30.
The prosecution’s case against Zhao highlights the significant risk posed by Binance’s non-compliance, which allowed criminals to launder billions of dollars through the platform. The Justice Department’s stance is that Zhao’s failure to implement adequate controls enabled this criminal activity, causing harm to the integrity of the financial system and undermining trust in cryptocurrency markets.
The recommended sentence is seen as a signal that the U.S. government is taking a tough stance on financial crime and non-compliance in the cryptocurrency industry. It also serves as a warning to other cryptocurrency exchanges and executives, emphasizing the importance of adhering to legal requirements and prioritizing anti-money laundering measures.
