A U.S. federal judge has approved Binance’s guilty plea and a hefty .3 billion settlement deal for violating anti-money laundering (AML) and sanctions laws through its cryptocurrency exchange. According to a Reuters report, the plea and the settlement were accepted on Friday, February 23. The Settlement Deal The U.S. Department of Justice (DOJ) had announced the plea deal and settlement in November, alleging that Binance had violated the Bank Secrecy Act (BSA), the International Emergency Economic Powers Act (IEEPA), and failed to register as a money transmitting business. Additionally, the agency alleged that Binance’s founder and now-former CEO, Changpeng “CZ” Zhao, failed to maintain an effective anti-money laundering program on the platform, violating the BSA. The
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A U.S. federal judge has approved Binance’s guilty plea and a hefty $4.3 billion settlement deal for violating anti-money laundering (AML) and sanctions laws through its cryptocurrency exchange.
According to a Reuters report, the plea and the settlement were accepted on Friday, February 23.
The Settlement Deal
The U.S. Department of Justice (DOJ) had announced the plea deal and settlement in November, alleging that Binance had violated the Bank Secrecy Act (BSA), the International Emergency Economic Powers Act (IEEPA), and failed to register as a money transmitting business.
Additionally, the agency alleged that Binance’s founder and now-former CEO, Changpeng “CZ” Zhao, failed to maintain an effective anti-money laundering program on the platform, violating the BSA.
The guilty plea and settlement comes after a years-long investigation by the DOJ into the leading crypto exchange.
Prosecutors stated that CZ’s failure to maintain an AML program on Binance “allowed money to flow to terrorists, cybercriminals, and child abusers through its platform.”
As part of the settlement deal, which prosecutors described as the largest corporate resolution, Binance agreed to forfeit $2.5 billion and pay a criminal fine of $1.8 billion, bringing the total to $4.3 billion. The exchange also agreed to retain an independent compliance monitor for three years and upgrade its AML program.
On the other hand, CZ pleaded guilty to money laundering violations and was released on a $175 million bail bond. As part of his settlement, he paid a fine of $50 million and gave up his CEO role at the exchange. CZ has remained in the U.S. ever since, as he was not allowed to travel back to his residence, Dubai.
Prosecutors Seek to Modify CZ’s Bond
In the latest court hearing on Friday, federal prosecutors sought to modify CZ’s bail bond. These modifications include the executive giving a three-day notice before any travel plans, surrendering his passports, and maintaining his current residence in the U.S. “unless he gets approval for a change.”
In addition, pretrial services officers asked that CZ be subjected to location monitoring.
CZ’s sentencing hearing is scheduled for April 30. While the assigned judge would determine his sentencing, prosecutors believe he could spend 18 months behind bars for his crimes.