Binance Holdings Ltd.’s chief executive Changpeng Zhao pleaded guilty to anti-money laundering violations and agreed to pay a US$50 million fine Tuesday under a sweeping deal worked out with the United States Department of Justice designed to keep the company operating.
Zhao agreed to step down as part of the settlement, which included the Treasury Department and the Commodity Futures Trading Commission, according to people familiar with the matter. Binance agreed to plead guilty to criminal charges and pay a US$4.3 billion fine, according to people familiar with the matter. The deal ends a years-long investigation into the cryptocurrency exchange.
In a charging document unsealed on Tuesday, Binance was charged with three counts, including money laundering violations, conspiracy to conduct an unlicensed money transmitting business, and U.S. sanctions violations. Binance allowed at least 1.1 million transactions, worth more than US$898 million, involving customers in Iran, according to the court filing.
The settlement negotiated between the two sides will resolve allegations of criminal wrongdoing. Bloomberg News reported the settlement on Monday.
Binance chose to “prioritize growth over compliance with U.S. legal requirements,” allowing it to conduct billions of dollars in transactions without gathering required information on customers or monitoring transactions, the U.S. said.
BNB, a cryptocurrency tied to the Binance ecosystem, slipped about five per cent following the news. The token had hit a five-month high earlier in the day on the news that the DOJ would soon confirm its settlement with the exchange.
U.S. Attorney General Merrick Garland and Treasury Secretary Janet Yellen were holding a press conference at 3:00Read more on financialpost.com