Binance, the biggest cryptocurrency exchange in the world, will be paying a fine of $4.3 billion following the CEO’s admission of guilt to federal charges.
Binance
The Justice Department announced on Tuesday that the CEO of the world’s biggest platform for buying and selling digital currencies, where users from all over the world participate, has admitted to breaking U.S. laws related to preventing money laundering and violating sanctions. As part of the agreement, the company will pay $4.3 billion in penalties and fees. Additionally, CEO Changpeng Zhao has plead guilty to one federal charge.
Binance is currently being investigated by multiple regulators and law enforcement agencies, including the Commodities Futures Trading Commission. On Tuesday, the company admitted to not implementing sufficient measures to prevent money laundering on its platform and also violating U.S. laws by allowing traders from countries under federal sanctions, such as Iran, to conduct business with Americans.
Akio Kon/Bloomberg via Getty Images
The creator and head of the platform, Zhao, a citizen of Canada, admitted guilt in a US court on Tuesday for breaking laws against money laundering and has agreed to resign from Binance’s top position. He could potentially be sentenced to 1 to 10 years in jail, with the sentencing scheduled for next year.
The company is currently embroiled in a separate legal case with the Security and Exchange Commission, which claims that the company did not properly register in the United States and unlawfully redirected investor funds to an account managed by Zhao.
At this time, Binance has not yet replied to the request for comment made by CBS News.
Binance recently reached an agreement with the Justice Department, only a few weeks following.Sam Bankman-Fried — the founder of another cryptocurrency exchange, FTX
He was convicted for committing fraud, conspiracy, and money laundering after the platform collapsed. The charges against him included misusing FTX funds for personal gain in real estate and unrelated projects.
On Tuesday, officials from the Justice Department stated that they continuously monitor cryptocurrency exchanges to ensure they are in compliance with regulations. They also stressed the importance for new and disruptive companies to prioritize following regulations over focusing solely on company growth.
In a statement, Monaco emphasized that prioritizing profits above compliance in corporate strategy will not lead to wealth, but instead to potential federal legal action.
More
Source: cbsnews.com