US DoJ: Over $4 billion to end criminal case against Binance

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Posted: November 20, 2023

• The US DoJ is reportedly seeking billions of dollars to end its criminal case against Binance and its co-founder
• The criminal charges includes violations of sanction laws, bank fraud, and money laundering

The United States has reportedly put a price on the criminal case against the largest crypto exchange – Binance and its co-founder – Changpeng Zhao. According to Bloomberg, the US Department of Justice (DoJ) is seeking over $4 billion from the exchange to ease its legal woes. Additionally, the report claims that a deal could be finalized by the end of this month.

The year-long investigation conducted by the Justice Department could bring multiple criminal charges against both the exchange and its founder. This could include violations under money laundering, bank fraud, and US sanction laws.

Moreover, this news follows a months-old report that claimed that the US DoJ was split over charging Binance over fears of causing a bank run. The regulatory authorities had been considering other options such as fines or non-prosecution agreements to mitigate risks to consumers. And, based on the latest report, the official step that would be taken by the US Department of Justice could be revealed soon.

Binance’s legal troubles

Notably, the DoJ is not the only US regulatory authority that has set its sights on the largest crypto exchange. The US Securities and Exchanges Commission (SEC) and the Commodity and Future Trading Commission (CFTC) have already taken action against the entity.

Earlier this year, the SEC charged Binance, its US affiliate, and Zhao. The charges against these entities included securities law violations for the sale of BNB, BUSD, crypto lending and staking services. The charges also claimed the entities operated unregistered exchanges, clearing agencies, and broker-dealers.

With regard to this, Binance moved to the court to dismiss the lawsuit claiming that the commission was overreaching its mandate. However, in its November 2023 filing, the SEC has asked the court to reject Binance’s motion. The commission’s request is backed by its claim that the exchange has deployed a “tortured interpretation of the law” in its dismissal motion. And, the court is yet to make a decision on this motion.

Prior to the SEC’s action, the CFTC charged the crypto exchange and Zhao for violating federal law and operating an illegal crypto derivatives exchange. In its press release, the regulator had claimed that”the defendants allegedly chose to knowingly disregard applicable provisions of the CEA while engaging in a calculated strategy of regulatory arbitrage to their commercial benefit.”

Similarly with the SEC, Binance sought to have this suit dismissed by claiming the regulator was overreaching jurisdiction. However, this motion for dismissal was disputed by the commission in September. Following this, the exchange filed for a renewed motion stating,

“Congress did not make the CFTC the world’s derivatives police, and the Court should reject the agency’s effort to expand its territorial reach beyond what is permitted by the law”