U.S. prosecutors are pursuing an above-guidance sentence of 36 months for Changpeng Zhao, the previous CEO of cryptocurrency exchange Binance. This recommendation, outlined in a sentencing memorandum filed with the court for the western district of Washington, alleges that Zhao’s actions merit a more severe punishment than the advisory guidelines suggest. Under these guidelines, Zhao’s potential prison sentence would range from 12 to 18 months. Prosecutors argue that a 36-month custodial sentence, doubling the upper limit of the guideline range, is warranted to reflect the gravity of Zhao’s offenses. They emphasize the need to uphold the law, serve as a deterrent, and ensure a just outcome. Zhao faces charges of willfully failing to implement an effective anti-money laundering program as mandated by the Bank Secrecy Act. Prosecutors contend that these failures allowed Binance to process transactions tainted by unlawful activities, including those involving individuals in sanctioned jurisdictions. Separately, Binance has faced legal challenges from the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission related to the alleged mishandling of customer assets and the operation of an unregistered exchange in the U.S. As part of a settlement, Binance agreed to pay $4.3 billion in fines and forfeiture, while Zhao paid a $50 million fine. Zhao stepped down as Binance’s CEO in November 2023 following this plea and was replaced by Richard Teng. Prosecutors allege that Zhao’s violations of U.S. law occurred on an unprecedented scale and that he exhibited a deliberate disregard for Binance’s legal obligations. They describe Binance’s operations under Zhao’s leadership as resembling a “Wild West” model, where he wagered on avoiding detection and minimizing consequences. However, Zhao has maintained his innocence and his official sentencing is scheduled for April 30th.
U.S. Prosecutors Seek 36-Month Sentence for Former Binance CEO
