New Lawsuit Targets CZ and Binance for Alleged Laundering of Stolen Cryptocurrency

• Lawsuit intensifies Binance’s legal troubles amid allegations of laundering stolen crypto.
• Plaintiffs accuse Binance of violating RICO Act, questioning asset recovery without its involvement.

Binance and its former CEO, Changpeng Zhao (CZ), are facing a new class-action lawsuit filed by three crypto investors in the U.S. District Court for the Western District of Washington. Previously, a post of CNF discussed that the SEC plans to revise its complaint against Binance, adding claims related to ‘Third Party Crypto Asset Securities.’

The plaintiffs allege that their stolen crypto assets were laundered through Binance, making them untraceable and preventing recovery. They argue that the platform’s failure to prevent money laundering violated the Racketeer Influenced and Corrupt Organizations (RICO) Act.

Bill Hughes, a ConsenSys lawyer, noted in a recent tweet that Binance and its former CEO, CZ, are being sued in Seattle federal court for allegedly facilitating the laundering of stolen crypto assets.

👀🚨👀🚨 @binance and @cz_binance were sued last Friday by class plaintiffs in Seattle federal court. An interesting class action brought by top class action lawyers alleging consumer harm as a result of Binance’s money laundering. And the natural, predictable follow-on civil… pic.twitter.com/vMlFuUnzEr

— Bill Hughes : wchughes.eth 🦊 (@BillHughesDC) August 20, 2024

The plaintiffs claim Binance’s actions violated the RICO statute and played a crucial role in the illegal activities conducted.

Hughes also suggested that the lawsuit builds on earlier government actions against Binance but expressed doubts about the plaintiffs’ ability to prove that without Binance, the stolen funds could have been recovered. He noted that the plaintiffs’ legal team is experienced in high-profile cases, though he believes Binance might settle before the case goes to trial.

Furthermore, this lawsuit compounds Binance’s ongoing legal issues. In November 2023, CZ pleaded guilty to U.S. money laundering charges, leading to a $4.3 billion fine and a four-month prison sentence. As of now, Binance (BNB) is trading at $554.71, with a decline of 2.38% in the past day and a surge of 4.55% in the past week. See BNB Price chart below.