Binance Founder Changpeng Zhao Sentenced to Prison for Money Laundering.
Binance founder Changpeng Zhao has been sentenced to four months in prison for allowing significant money laundering activities on the platform. He pleaded guilty to failing to establish an effective anti-money laundering program, violating the Bank Secrecy Act. This sentencing marks the first instance of someone being imprisoned for such violations. Zhao's sentence also includes a $50 million fine, considerably less than the three years the Justice Department had sought.
Prosecutors highlighted that Zhao knowingly allowed transactions that violated U.S. sanctions, involving entities like Hamas, al-Qaeda, and Iran, amounting to nearly $900 million. Despite defense arguments that these transactions were a minor part of Binance’s operations, the court emphasized the need for accountability in upholding financial laws.
Zhao's legal team had requested no prison time, citing his cooperation with U.S. authorities and efforts to improve compliance at Binance since 2022. However, the court decided that a custodial sentence was necessary to underscore the seriousness of the violations.