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- Last year, Binance CEO Changpeng Zhao pleaded guilty to money laundering and US sanctions violations in a sweeping deal.
- According to the latest report, the prosecutors, in a memo filed to the federal court in Seattle, want the judge to accept the plea deal.
The largest crypto exchange in the world by daily trading volume, Binance, was in hot waters last year after the US authorities pressed multiple charges against the company and its CEO Changpeng Zhao. As captured in the court document, Binance was charged with money laundering violations, US sanctions violations, and conspiracy to conduct an unlicensed money-transmitting business.
According to the report, Binance allowed transactions estimated to be around $890 million to be facilitated by customers in Iran despite the country knowingly under strict financial sanctions. On top of that, the exchange facilitated transactions between US users and individuals residing in sanctioned jurisdictions including Cuba, Syria, and illegally occupied regions of Ukraine.
According to US Attorney General Merrick Garland, Binance became the world’s largest exchange partly because of the crimes committed.
US Treasury Secretary Janet Yellen commented on the court document:
Binance turned a blind eye to its legal obligations in the pursuit of profit. Its willful failures allowed money to flow to terrorists, cybercriminals, and child abusers through its platform. Today’s historic penalties and monitoring to ensure compliance with US law and regulations mark a milestone for the virtual currency industry.
Zhao was also accused of putting the company’s growth and profit on top of his priority list instead of compliance with US laws. The indictment states that he informed his staff it was “better to ask for forgiveness than permission.”
Memo Filed as Prosecutors Push for Plea Deal in the Binance Case
In a sweeping deal with the US Justice Department, Zhao pleaded guilty to money laundering charges and violation of US sanctions. He admitted that the exchange failed to prevent and report suspicious transactions orchestrated by terrorist organizations such as Hamas’ al-Qassam Brigades, the Islamic State, and al Qaeda.
To allow the company to continue to operate, Zhao agreed to step down as the CEO, while Binance was imposed with a fine of $4.3 billion. This did not end there as Zhao was also required to pay $200 million in fines as part of the settlement. With his guilty plea, the former Binance CEO is reported to face up to 10 years in prison. His sentencing hearing was recently postponed until April 30.
According to the latest memo filed to a federal court in Seattle, the prosecutors want the judge to accept the plea deal. In the prosecutors’ argument, Binance committed intentional misconduct, triggering “hundreds of millions of dollars of collateral consequences.” Last month, one of the former hostages in the Hamas-Israel war and the families of two men killed filed a lawsuit against Binance for processing transactions for Hamas between 2017 and 2023.
For years, Binance remained willfully blind to the use of its platform by illicit actors, including terrorists, by failing to do any due diligence on the vast majority of its users before August 2021. Incredibly, Binance went out of its way to protect users associated with Hamas and other terrorist groups from regulatory scrutiny, especially if they were ‘VIP users who generated huge profits for Binance.
In separate news, Web3 gaming token PIXEL explodes on Binance as it hits $0.68.
