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US Prosecutors Recommend 3-Year Prison Sentence for Binance's Changpeng Zhao: Report

Finance Magnates

Cryptocoins News / Finance Magnates 62 Views

US prosecutors have proposed a 36-month prison sentence for Binance's former CEO, Changpeng Zhao. According to a report by CNBC, the prosecutors argued that such a sentence, which is double the advisory guidelines, reflects the seriousness of the charges against Zhao.

The recommendation, outlined in a sentencing memorandum filed with the Western District Court of Washington, highlights the severity of the accusations against Zhao, who stepped down from his position last November following a plea deal with the US Department of Justice.

US Prosecutors' Charges against Zhao

US prosecutors said a 36-month custodial sentence is necessary to underscore the seriousness of the charges against Zhao, which include failure to implement anti-money laundering measures as mandated by the Bank Secrecy Act. The memorandum emphasized Zhao's alleged role in allowing Binance to process transactions involving unlawful activities, including those from sanctioned countries.

The case against Zhao occurs amidst a backdrop of legal challenges for Binance, with the exchange facing lawsuits from both the US Securities and Exchange Commission and the Commodity Futures Trading Commission.

Allegations include mishandling customer assets and operating an illegal, unregistered exchange in the US. Authorities have also ordered Binance to pay hefty fines, with Zhao agreeing to a $50 million penalty as part of the plea deal. However, he has not publicly commented on the recent developments. Zhao's official sentencing is scheduled for April 30.

Binance CEO's Legal Struggle

In January, a federal judge rejected a travel requestfrom Zhao to visit his home in the United Arab Emirates for a family emergency. The judge deemed him a significant flight risk due to his immense wealth and ties to the UAE, despite offering to post his $4.5 billion equity in Binance as security for his return.

In November, Zhao pleaded guilty in a Seattle federal court to failing to maintain an effective anti-money laundering program at Binance. As part of the case, Binance agreed to pay $4.3 billion in penalties.

In a letter to Judge Richard Jones dated December 22, Zhao's lawyers requested permission for him to travel to Abu Dhabi on January 4 for one to four weeks due to a family emergency. However, federal prosecutors did not consent to Zhao's request, leading to a hearing on December 29, when Judge Jones denied the travel bid.

This article was written by Jared Kirui at www.financemagnates.com.
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