Binance to pay billions in money laundering case, CEO resigns
NEW YORK
Binance chief executive Changpeng Zhao pleaded guilty on Nov. 21 to U.S. money laundering violations, in a deal that will see the cryptocurrency exchange he founded pay over $4 billion in penalties.
"Binance became the world's largest cryptocurrency exchange in part because of the crimes it committed - now it is paying one of the largest corporate penalties in U.S. history," Attorney General Merrick Garland said in a statement.
Binance's guilty plea is part of coordinated action including with the Treasury Department's Financial Crimes Enforcement Network and Office of Foreign Assets Control (OFAC), the Department of Justice said.
Zhao pleaded guilty to failing to maintain an effective anti-money laundering program, the Department of Justice said, and he has resigned from his position of CEO.
Binance's agreements with the Treasury Department's agencies include a civil money penalty of $3.4 billion and a $968 million penalty involving OFAC.
These mark the agencies' largest settlements in history.
"Binance turned a blind eye to its legal obligations in the pursuit of profit," Treasury Secretary Janet Yellen said in a statement.
"Its willful failures allowed money to flow to terrorists, cybercriminals and child abusers through its platform."
Yellen said the penalties, and a five-year monitorship imposed on Binance, mark a "milestone for the virtual currency industry."
Binance's violations included its failure to prevent and report transactions with groups like the Islamic State of Iraq and Syria, and matching trades between U.S. users and those in sanctioned jurisdictions like Iran and North Korea, said the Treasury.
Binance was created in 2017 and cornered much of the crypto-trading market, turning Zhao into a billionaire.
Binance runs crypto exchanges and provides other services across the world, but it has taken a severe hit since crypto markets collapsed and regulators began probing the legality of its business.
