On April 30, a court hearing will be held at which a punishment will be chosen for the founder and former CEO of the Binance crypto exchange, Changpeng Zhao (CZ). In conversation with Cointelegraph lawyers and politicians discussed options for the development of events.
Accusations
The ex-CEO of the trading platform will appear before a judge nearly six months after pleading guilty to violating the Bank Secrecy Act for failing to maintain an effective anti-money laundering program at Binance.
As part of an agreement with the US Department of Justice, he agreed to pay a fine of $50 million and resign from his position as CEO. For the exchange itself, the settlement amount was $4.3 billion.
According to sentencing guidelines, the judge may sentence Zhao to 10 years in prison, given the severity of the charge. But CZ pleaded guilty to only one of the counts, so his punishment includes imprisonment for a period of 12 to 18 months.
At the end of March, the founder of the collapsed FTX, Sam Bankman-Fried, was sentenced to 25 years in prison on charges of money laundering, fraud and conspiracy. Experts noted differences between the cases of the heads of the two crypto exchanges.
In his opinion, the US authorities may be trying to “send a message” to lawbreakers in the crypto industry, and this does not depend on the severity of CZ’s sentence. Vela also allowed “some leniency” for Zhao for his cooperation and guilty plea.
Possible concerns
Former Assistant U.S. Attorney for the Eastern District of New York Mark Beeney added that unlike the Bankman-Fried criminal case, Zhao's case is more “resembling a regulatory violation.”
However, in his opinion, there is a risk that the events surrounding the attack Hamas Israel may influence the judge when sentencing CZ.
According to media reports, since December 2021, Israeli authorities have blocked 189 accounts on the Binance exchange, allegedly related to illegal groups. Since October 7, the cryptocurrency exchange has closed, at the request of the authorities, more than 100 accounts associated with the financing of Palestinian terrorists.
Bini noted that the charges against CZ also include laundering funds linked to Hamas. If prosecutors focus on this issue, public opinion risks not being on the side of Binance and its founder:
Until his sentencing, Zhao remains free, for which he posted bail of $175 million. However, prosecutors demanded that the former head of the platform be prohibited from leaving the United States for fear of escape. They cited significant wealth outside the country and minimal ties to the United States as risks.
Zhao's lawyers challenged the travel ban, but the court sided with law enforcement officers. In December, the court rejected the entrepreneur’s request to return home to the UAE, despite the proposed bail of $4.5 billion.
In April, Forbes estimated CZ's fortune at $33 billion and placed him 50th in the list of billionaires.
Source: Cryptocurrency
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