Binance founder CZ is under investigation for money laundering, raising concerns about cryptocurrency use.
In this legal battle, the founder of Binance, Changpeng Zhao, found justice in an American court. In the hearing conducted on April 30, the prosecutor sentenced him to 3 years in prison.
Highlighting the Issues
The founder of Binance pleaded guilty for not taking safety measures to stop money laundering on his Platform. This is significant because it adds to the ongoing conversation about him and his company’s practices.
In the justice department, prosecutor stated that
“Zhao’s willful violation of U.S. law was no accident or oversight.”
They further added that
“He made a business decision that violating U.S. law was the best way to attract users, build his company, and line his pockets.”
This indicated that Binance didn’t take enough measures to launch a strong anti-money laundering program to stop this problem, as required by the Bank Security Act.
The punishment of 3 years, which is greater than suggested 18 months in prison, indicates the seriousness of the allegations and the need to obey the law strictly.
Core Issues in the Allegations Against Binance Founder Zhao
The founder of Binance, Zhao, helped Binance handle transactions related to illegal activities. He also involved Americans and individuals under sanctions.
The prosecutor stated that his knowledge is up-to-date only until January 2022. As of that time, more than 100,000 suspicious transactions with designated terrorist organizations like Hamas, al-Qaeda, and ISIS were widely recognized as terrorist groups by various countries and international bodies.
Zhao wrote a letter to judge stating that he failed to stop these illegal transaction and acknowledged that there is no excuse to this action
“I apologize for my poor decisions and accept full responsibility for my actions. In hindsight, I should have focused on implementing compliance changes at Binance from the get-go, and I did not. There is no excuse for my failure to establish the necessary compliance controls at Binance.”
Previously, once talking to his team, Zhao said that it’s “better to ask for forgiveness than permission” in matters of legal compliance.
Additional Incidents of Money Laundering
As noted by the crypto researcher Emperor Osmo, the performance of BNB stayed stronger than that of Bitcoin.
It’s not the first time Binance to faced these allegations. Nigeria also said in their highlights to take legal action against Binance and two of its leaders for alleged money laundering practices and tax evasion.
FTX also faced similar problems in 2022, resulting in Bankman-Fried being found guilty of fraud and receiving a 25-year sentence.
