Changpeng Zhao, the founder of Binance, has been sentenced to four months in prison for oversights that allowed terrorist groups and cybercriminals to operate freely on the world’s largest cryptocurrency exchange.
Entering the courtroom with a group of legal advisors in tow, the billionaire made a solemn appearance while wearing a dark suit with a light blue tie.
According to Verge’s live stream of the court, his mother and sister were watching the proceedings from the front row, so you could feel the seriousness of the situation.
Due to Zhao’s serious crimes, the prosecution requested a sentence of three years in prison, which is double the recommended period of eighteen months, in its sentencing letter. On the other hand, Zhao’s defense team responded by arguing that there was no prior precedence for incarceration in cases involving the Bank Secrecy Act.
In his evaluation, Judge Richard Jones emphasized Zhao’s preference for Binance’s growth and financial success over compliance with US regulatory laws. Judge Jones underlined the severity of the misconduct while casting doubt on Zhao’s propensity to commit similar offenses again.
Although Changpeng Zhao is not as well-known as Sam Bankman-Fried of FTX, he is nonetheless quite influential in the cryptocurrency space. The Chinese-Canadian businessman founded Binance in 2017 and became a key player in the development of the sector.
Prosecutors have termed Binance’s facilitation of sanctions breaches totaling over $898 million as an extraordinary violation of US law. This is concerning information that has come to light throughout court proceedings.
In addition to failing to implement efficient anti-money laundering safeguards, Zhao and other Binance officials “displayed a flagrant disregard for US regulatory” frameworks, including the Bank Secrecy Act (BSA).
As a result, Iranian clients broke sanctions protocol by engaging in unlawful activities totaling at least $1.1 million with US counterparts. Comparable violations were noted with other countries under sanctions, such as Syria and Cuba.
