Binance founder Zhao Changpeng (趙長鵬) was ordered to spend four months in prison for failures that allowed cybercriminals and terrorist groups to freely trade on the world’s largest cryptocurrency exchange.
Zhao, 47, was sentenced on Tuesday by US District Judge Richard Jones in Seattle, Washington. The billionaire’s mother and sister watched his sentencing from the front row of the courtroom.
The sentence was far below the three years requested by prosecutors, who had sought to make an example out of Zhao to a heavily scrutinized industry rebounding from a slew of high-profile scandals. It is the first time a chief executive officer has ever gone to jail for a bank secrecy act violation in the US, a charge that has been used repeatedly in crypto prosecutions in the past few years.
Photo: Bloomberg
In imposing the sentence, Jones said he hoped Zhao understood that, despite “wealth, power and status,” no person is immune from prosecution or above the law.
Zhao, who did not visibly react to the sentence, is expected to serve his four-month stint at Seattle’s Federal Detention Center, SeaTac. A date for Zhao to turn himself in to prison authorities has not been decided, although he has expressed eagerness to get back to his family in the United Arab Emirates.
In a post on X after the sentencing, Zhao said: “I will do my time, conclude this phase and focus on the next chapter of my life (education).”
He added that he “will remain a passive investor (and holder) in crypto.”
Zhao pleaded guilty in November last year for failing to implement an adequate money laundering program at Binance, an exchange that began in Shanghai in 2017 and ballooned to process trillions of dollars worth of trades each year. At the same time, Binance pleaded guilty to anti-money laundering and sanctions law violations, and agreed to pay US$4.3 billion to resolve investigations with the US department and other regulators.
US federal prosecutor Kevin Mosley said the Binance founder’s violations of US law were intentional, not an oversight.
“This wasn’t a mistake,” Mosley said. “It wasn’t a regulatory ‘oops.’”
The failure to maintain an adequate money laundering program opened the door to illicit actors, including crypto mixers, hackers and terrorist groups including al-Qaeda and Islamic State, to trade Bitcoin on the platform, Mosley said.
In an example detailed by the Financial Crimes Enforcement Network, or FinCEN, the al-Qassam Brigades, the military wing of Hamas, used Bitcoin transactions to raise money for the Palestinian resistance.
Hamas, which has been designated by the US as a terrorist organization, murdered more than 1,200 Israelis on Oct. 7 last year.
Despite Zhao’s well-publicized criminal case, he has held onto his personal fortune. His wealth ballooned by US$25 billion as the crypto industry recovered last year and he is currently ranked as the 42nd richest person worldwide, according to Bloomberg Billionaires Index.
The head of Shin Bet, Israel’s domestic intelligence agency, was sacked yesterday, days after Israeli Prime Minister Benjamin Netanyahu said he no longer trusts him, and fallout from a report on the Oct. 7, 2023, Hamas attack. “The Government unanimously approved Prime Minister Benjamin Netanyahu’s proposal to end ISA Director Ronen Bar’s term of office,” a statement said. He is to leave his post when his successor is appointed by April 10 at the latest, the statement said. Netanyahu on Sunday cited an “ongoing lack of trust” as the reason for moving to dismiss Bar, who joined the agency in 1993. Bar, meant to
Indonesia’s parliament yesterday amended a law to allow members of the military to hold more government roles, despite criticisms that it would expand the armed forces’ role in civilian affairs. The revision to the armed forces law, pushed mainly by Indonesian President Prabowo Subianto’s coalition, was aimed at expanding the military’s role beyond defense in a country long influenced by its armed forces. The amendment has sparked fears of a return to the era of former Indonesian president Suharto, who ex-general Prabowo once served and who used military figures to crack down on dissent. “Now it’s the time for us to ask the
The central Dutch city of Utrecht has installed a “fish doorbell” on a river lock that lets viewers of an online livestream alert authorities to fish being held up as they make their springtime migration to shallow spawning grounds. The idea is simple: An underwater camera at Utrecht’s Weerdsluis lock sends live footage to a Web site. When somebody watching the site sees a fish, they can click a button that sends a screenshot to organizers. When they see enough fish, they alert a water worker who opens the lock to let the fish swim through. Now in its fifth year, the
‘INCREDIBLY TROUBLESOME’: Hours after a judge questioned the legality of invoking a wartime power to deport immigrants, the president denied signing the proclamation The US on Friday said it was terminating the legal status of hundreds of thousands of immigrants, giving them weeks to leave the country. US President Donald Trump has pledged to carry out the largest deportation campaign in US history and curb immigration, mainly from Latin American nations. The order affects about 532,000 Cubans, Haitians, Nicaraguans and Venezuelans who came to the US under a scheme launched in October 2022 by Trump’s predecessor, Joe Biden, and expanded in January the following year. They would lose their legal protection 30 days after the US Department of Homeland Security’s order is published in the Federal
RSS