U.S. prosecutors are not holding back in seeking justice for the former CEO of cryptocurrency exchange Binance. They are pushing for an above-guidance sentence of 36 months, arguing that this harsh punishment is necessary to reflect the gravity of his crimes. The sentencing memorandum filed with the court for the western district of Washington paints a picture of deliberate wrongdoing on the part of the former CEO.
According to the prosecutors, Zhao is accused of enabling money laundering by failing to implement a proper anti-money laundering program as required by the Bank Secrecy Act. This failure allegedly allowed Binance to process transactions involving proceeds of unlawful activity, including transactions between Americans and individuals in sanctions jurisdictions. The seriousness of these accusations is highlighted by the prosecutors’ recommendation for a custodial sentence double the high end of the advisory guidelines.
The legal troubles facing Binance do not stop at the former CEO. The cryptocurrency exchange has been sued by the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission over mishandling customer assets and operating an illegal, unregistered exchange in the U.S. The U.S. government has ordered Binance to pay fines and forfeiture amounting to billions of dollars, with Zhao agreeing to a hefty fine of $50 million.
Prosecutors have criticized Zhao’s leadership, stating that he operated Binance on a “Wild West” model with a deliberate disregard for the company’s legal responsibilities. They argue that Zhao’s actions violated U.S. law on an “unprecedented scale” and that he thought he could evade consequences for his crimes. However, now that Zhao has been caught, prosecutors are determined to hold him accountable for his actions.
As the sentencing date looms closer, the former CEO of Binance is facing the repercussions of his alleged misconduct. The outcome of this case will not only impact Zhao’s future but also serve as a warning to other cryptocurrency exchanges about the importance of complying with financial regulations. Regardless of the final sentencing decision, the downfall of Binance’s former CEO serves as a cautionary tale of the consequences of turning a blind eye to legal responsibilities in the world of cryptocurrency.