Singapore, Wednesday, November 22–Richard Teng assumed the role of Binance CEO, following the resignation of Changpeng Zhao as CEO over money laundering charges.1
Binance CEO Changpeng Zhao stepped down from his position and pleaded guilty to breaking US anti-money laundering laws.2
On Tuesday, Changpeng Zhao appeared in a federal court in Seattle and submitted his plea, as per court documents. Prosecutors alleged that Binance, under Zhao’s ownership, facilitated transactions with sanctioned groups. They claimed that Binance encouraged U.S. users to conceal their location, allowing the company to evade compliance with U.S. anti-money laundering laws.
The charges against Zhao stem from a years-long probe into the world’s largest crypto exchange. As part of a $4.3 billion settlement, Zhao will personally pay a $50 million fine.
The US Justice Department has accused Binance of failing to implement basic anti-money laundering controls, allowing criminals to use the exchange to launder illicit funds.
The department also alleges that Binance allowed US citizens to trade digital assets on its platform without registering with the US government.
“Binance turned a blind eye to its legal obligations in the pursuit of profit. Its willful failures allowed money to flow to terrorists, cybercriminals, and child abusers through its platform,” Treasury Secretary Janet Yellen said during a press conference.3
The Treasury Department also charged that it has taken “unprecedented action” to enforce Binance’s accountability for violating U.S. anti-money laundering laws.
The allegations include Binance’s failure to prevent and report “suspicious transactions with terrorists,” citing both Al Qaeda and ISIS. The settlement imposes a $3.4 billion penalty on FinCEN and $968 million on OFAC, along with compliance requirements and monitoring for a duration of five years. 4
Zhao’s plea agreement comes as Binance faces increasing scrutiny from regulators around the world.
The UK’s Financial Conduct Authority earlier banned Binance from conducting regulated activities in the country, while the Netherlands ordered the exchange to comply with anti-money laundering regulations.
In a statement, Binance said that it “takes its regulatory responsibilities very seriously” and is “committed to working with regulators to address any concerns.”
The exchange added that it is “making significant investments” in its compliance program and is “confident” that it will “meet or exceed all regulatory requirements.”
The settlement with the Justice Department is a significant blow to Binance, which has long touted its commitment to compliance. The company’s reputation has been tarnished in recent months, and the settlement is likely to lead to further scrutiny from regulators.
Before joining Binance, Richard Tenge served as the CEO of the Financial Services Regulatory Authority at Abu Dhabi Global Market (ADGM), where he demonstrated his prowess as one of the globe’s leading innovative regulators.
- Binance: https://www.binance.com/en/blog/leadership/bio-richard-teng-binances-new-ceo-6819833624741779461[↩]
- Reuters: https://twitter.com/Reuters/status/1727152428905111598[↩]
- DOJ: https://www.justice.gov/usao-wdwa/pr/binance-and-ceo-plead-guilty-federal-charges[↩]
- Regmedia: https://regmedia.co.uk/2023/11/21/usa-v-binance.pdf[↩]
