Former Binance CEO CZ Must Stay in the US as Judge Rules
A federal judge has ruled that Changpeng “CZ” Zhao, the former CEO of crypto exchange Binance, must remain in the United States. This decision comes after Zhao pleaded guilty to violating the Bank Secrecy Act. Previously, there was a ruling that would have allowed Zhao to return to his family in the United Arab Emirates until his sentencing in February 2024. However, prosecutors argued that he poses a flight risk due to his wealth and the lack of an extradition treaty with the UAE.
Zhao resigned as Binance CEO following the company’s admission of sanctions and money transmission violations. Binance agreed to pay a $4.3 billion penalty and implement compliance measures. As part of his personal plea deal, Zhao put up $15 million and had guarantors offer $5 million in collateral for a $175 million bond. He also faces up to 10 years in prison and must pay a $50 million fine.
Defense attorneys argued that Zhao has already shown accountability by traveling to the US and stated that his family cannot uproot their lives for a sentencing hearing. However, Department of Justice officials convinced Judge Richard Jones that despite the bond, Zhao has sufficient means to flee. The prosecutors are not seeking pre-sentencing detention but are requiring him to stay in the country.
Judge Jones did not specify when or if he would schedule a bond hearing. Zhao’s sentencing is scheduled for February 23, 2024, and he has the option to appeal any sentence over 18 months. This latest development adds another twist to an ongoing crypto saga that has had significant repercussions throughout the industry.
Hot Take: CZ’s Legal Troubles Continue
The ruling by Judge Richard Jones ordering Changpeng “CZ” Zhao to stay in the United States prolongs his legal troubles. Despite his plea deal and significant financial commitments, prosecutors successfully argued that Zhao poses a flight risk due to his wealth and the lack of an extradition treaty with the UAE. This decision keeps him on US soil until his sentencing in February 2024. The outcome of this case will have implications not only for Zhao but also for the broader crypto industry, which has been closely watching these developments. As the former CEO of Binance, Zhao’s actions and their consequences serve as a reminder of the regulatory challenges faced by crypto businesses.
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