Binance’s founder and former chief executive, Changpeng “CZ” Zhao, should spend three years in prison for his role in enabling the crypto exchange to violate federal sanctions and money laundering laws, the U.S. Department of Justice said Tuesday night.
Attorneys with the DOJ filed a sentencing memo arguing he should spend 36 months in prison and pay a $50 million fine after he pleaded guilty to violating the Bank Secrecy Act last November.
“The sentence in this case will not just send a message to Zhao but also to the world. Zhao reaped vast rewards for his violation of U.S. law, and the price of that violation must be significant to effectively punish Zhao for his criminal acts and to deter others who are tempted to build fortunes and business empires by breaking U.S. law,” the filing said.
Zhao originally faced up to 18 months in prison under the terms of his plea agreement. The DOJ argued in Tuesday’s filing that “the scope and ramifications of Zhao’s misconduct were massive,” and so “an upward variance is appropriate here.”
The $50 million fine was already agreed to by both the prosecution and Zhao’s defense team.
He was originally set to be sentenced in late February, but the hearing was postponed by mutual agreement to April 30. He hasn’t been able to return to Dubai, where his partner and some of his children live, since he first appeared in federal court in Seattle, Washington last year.
Binance, the world’s largest crypto exchange, pleaded guilty to charges of its own at the same time as Zhao, agreeing to a massive fine and reporting to a court-appointed monitor. The monitor has yet to be appointed.
