The US Department of Justice (DoJ) has argued that former Binance CEO Changpeng ‘CZ’ Zhao should receive three years in prison ahead of his sentencing on April 30 for money laundering.
According to a sentencing memo filed Tuesday, Justice Department lawyers recommended the court “sentence 36 months in prison, which is above the guidelines,” on Zhao’s “willful violation of U.S. law.”
The former Binance CEO gambled that “he won’t get caught, and if he does, the consequences won’t be as serious as the crime,” and Justice Department lawyers say Binance’s “Wild West” strategy doesn’t comply. claimed. Anti-money laundering requirements in the United States have made Zhao “one of the richest people in the world and a celebrity in the cryptocurrency industry.”
The 36-month sentencing recommendation goes far beyond federal sentencing guidelines, which would see the former Binance CEO jailed for 18 months. The Justice Department recommended a harsher sentence than expected, saying Zhao’s sentence would “not only send a message to Zhao, but also send a message to the world” and serve as a deterrent to others.
Under Zhao’s leadership, Binance has grown to become the world’s largest cryptocurrency exchange by trading volume. In November 2023, he stepped down as CEO of Binance after pleading guilty to U.S. money laundering and sanctions violations as part of a settlement with the DoJ. Under the terms of the settlement, Binance was ordered to pay a $4.3 billion fine and “completely withdraw” from the United States.
Zhao himself was ordered to pay a $50 million fine and was banned from involvement with Binance for at least three years under the terms of his guilty plea agreement.
Ahead of sentencing later this month, Zhao was ordered to post $175 million bail. U.S. District Judge Richard Jones imposed travel restrictions on the former Binance CEO, preventing him from leaving the United States after prosecutors deemed him a flight risk.
The exchange is still facing lawsuits from the U.S. Securities and Exchange Commission (SEC), which dismissed the lawsuit in a series of lawsuits last December.