Binance to Pay $2.7B in Fine to CFTC; CZ Will Pay $150M

  • The U.S. Court ordered Binance to pay $2.7 billion in penalty to the CFTC as part of the settlement of the lawsuit.
  • The court order mandated Changpeng Zhao to pay $150 million as a fine for money laundering.
  • The move came following Zhao’s guilty plea in the $4.3 billion settlement in November.

Recent reports revealed the U.S. court’s move against Binance and its former CEO Changpeng Zhao, in the CFTC lawsuit. The court ordered the company to pay a fine of $2.7 billion and Zhao individually a $150 million to the Commodity Futures Trading Commission (CFTC). This was following a case filed by the CFTC for money laundering.

According to an official announcement by the CFTC, the U.S. District Court for the Northern District of Illinois has approved the CFTC-Binance settlement, asking Binance to “disgorge $1.35 billion of ill-gotten transaction fees” and submit $1.35 as a fine to the commission. The CFTC, further elaborating on the court’s move, cited,

[The court] has approved the previously announced settlement and entered a consent order of permanent injunction, civil monetary penalty, and equitable relief against Changpeng Zhao and his companies Binance Holdings Limited, Binance Holdings (IE) Limited, and Binance (Services) Holdings Limited (together, Binance).

In March 2023, the regulators alleged the company and its founder Zhao of “Willful Evasion of Federal Law and Operating an Illegal Digital Asset Derivatives Exchange.” Last month, Binance and Zhao pleaded guilty to breaching anti-money laundering rules following the long legal tussle with the CFTC. Agreeing to pay $4.3 billion in settlement, Zhao stepped down as the CEO, introducing the new CEO Richard Teng, the former Global Head of Binance’s Regional Markets.

Consequently, reports revealed a potential prison sentence for Zhao that could span up to 10 years. While Zhao intended to return to the UAE to his family, the court filing prohibited him from such a move, highlighting a “flight risk.” Quoting the court ruling, the former Securities and Exchange Commission (SEC) official John Reed Stark posted on X, “The defense claims that Mr. Zhao faces merely a “brief” sentence and has no incentive to flee.” 

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Source: https://coinedition.com/binance-to-pay-2-7b-in-fine-to-cftc-cz-will-pay-150m/