Binance CEO Changpeng Zhao steps down, will pay billions to settle US illicit finance case
- Changpeng Zhao pleaded guilty to failing to maintain an effective anti-money laundering programme at cryptocurrency exchange he founded
- Binance will pay US$4.3 billion in one of the largest corporate agreements in US history, Zhao paying a US$50 million fine and steps down as CEO
Binance chief Changpeng Zhao stepped down and pleaded guilty to breaking US anti-money laundering laws as part of a US$4.3 billion settlement resolving a years-long probe into the world’s largest cryptocurrency exchange, prosecutors said on Tuesday.
The deal, which will see Zhao personally pay US$50 million, was described by prosecutors as one of the largest corporate penalties in US history. It is another blow to the cryptocurrency industry that has been beset by investigations and comes on the heels of the recent fraud conviction of FTX founder Sam Bankman-Fried.
But several legal experts said it was a good outcome for Zhao, leaving his vast wealth intact and allowing him to retain his stake in Binance, the exchange he founded in 2017.
Binance broke US anti-money laundering and sanctions laws and failed to report more than 100,000 suspicious transactions with organizations the US described as terrorist groups including Hamas, al-Qaeda and the Islamic State of Iraq and Syria, authorities said.
The exchange also never reported transactions with websites devoted to selling child sexual abuse materials and was one of the largest recipients of ransomware proceeds, they said.
“Binance made it easy for criminals to move their stolen funds and illicit proceeds on its exchanges,” US Attorney General Merrick Garland said on Tuesday. “Binance also did more than just fail to comply with federal law. It pretended to comply.”