Binance Fined Billions By U.S. Authorities

November 22, 2023 | 2 Comments

Binance founder Changpeng Zhao has agreed to plead guilty and and pay a $50 million fine, and Binance itself also pleaded guilty and agreed to pay $4.3 billion in fines and restitution to the U.S. government.

A New York Times story said, “Changpeng Zhao, the founder of Binance, the largest cryptocurrency exchange in the world, pleaded guilty to money laundering violations, the government said on Tuesday, a stunning blow to the most powerful and influential figure in the global crypto industry.

“Binance itself also pleaded guilty and agreed to pay $4.3 billion in fines and restitution to the government, according to federal authorities. Under the agreement, Binance reached settlements with the Justice Department, the Treasury Department and the Commodity Futures Trading Commission, which have all been investigating the company for years.

“As part of his guilty plea, Mr. Zhao agreed to pay a $50 million fine and step down from his role as the company’s chief executive. Mr. Zhao faces up to 18 months in prison under federal sentencing guidelines, but prosecutors are keeping open the possibility of asking for a stiffer penalty, according to senior Justice Department officials.

“Binance, as part of its own plea deal with federal prosecutors, will accept the appointment of a government monitor to oversee the business. Mr. Zhao is barred from any involvement in Binance until three years after the monitor is appointed, court papers show.”

Speaking at a press conference, U.S. Attorney General Merrick Garland said, “We are here today to announce that the Justice Department has secured felony guilty pleas from the world’s largest cryptocurrency exchange, Binance, and from its founder and CEO, Changpeng Zhao, also known as CZ.

“Binance has agreed to plead guilty to willfully violating the Bank Secrecy Act, knowingly failing to register as a money transmitting business, and willfully violating the International Emergency Economic Powers Act.

“These laws ensure that our financial institutions are not available to designated terrorist organizations, drug traffickers, and sanctioned nation-states that threaten public safety and our national security.

“The Justice Department is requiring Binance to pay $4.3 billion in penalties and forfeiture. This is one of the largest penalties we have ever obtained from a corporate defendant in a criminal matter.

“In part because of the crimes it committed, Binance became the largest cryptocurrency exchange in the world. Now Binance is paying one of the largest corporate penalties in U.S. history.

“The message here should be clear: Using new technology to break the law does not make you a disruptor. It makes you a criminal,” the U.S. Attorney General added.

Binance is not a Bermuda business and Bermuda is not mentioned in the 136 page SEC complaint, however 5 years ago, back in 2018, the Government announced a Memorandum of Understanding with that Binance that they said, at that time, would see the company “develop its global compliance base in Bermuda, creating at least forty jobs in Bermuda.”

The Guardian noted, “The announcement is another huge blow for the cryptocurrency sector. The settlement with Binance comes less than a month after Sam Bankman-Fried was convicted on seven counts of fraud and conspiracy for his part in the collapse of FTX, a trading platform that had been second only in size to Binance. The FTX founder faces 115 years in prison when he is sentenced next year.”

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Category: All, Business, Crime, technology

Comments (2)

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  1. David Skinner says:

    And this is the man who Premier Burt signed an MOU with and who was to be one of if not the main cornerstone of the fintech pillar for ‘s economy! What if any vetting did the Premier and Finance Minister do before cozying up to this convicted criminal? The Economist reported that he overlooked basic processes in pursuit of market share for Binance, resulting in billions of dollars in transactions with terrorist organisations including Hamas, Al Quaeda and ISIS as well as having thousands of clients in Iran, North Korean and the Russian dark web. Bermuda’s reputation as a quality jurisdiction for financial services would be in the toilet if it isn’t already!

    • PR says:

      None whatsoever as BINANCE was already under investigation for multiple violations when the MOU was announced and then signed.

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