Binance founder pleads guilty to anti-money laundering charge, steps down

globalnews.ca:

The U.S. government dealt a massive blow to the world’s largest cryptocurrency exchange Binance as its founder, Changpeng Zhao, pleaded guilty to a felony charge Tuesday related to his failure to prevent money laundering on his platform.

Binance also agreed to a roughly $4 billion settlement with the U.S. over violations of the Bank Secrecy Act and apparent violations of sanctions programs, including failure to put into place a suspicious transaction reporting programs. Zhao announced that he stepped down as the company’s chief executive and said insider Richard Teng has been named as his replacement.

Over the summer, the company was accused of operating as an unregistered securities exchange and violating a slew of U.S. securities laws in a lawsuit from regulators. That case was similar to practices uncovered after the collapse of FTX, the second largest cryptocurrency exchange, last year.

“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,” said Attorney General Merrick B. Garland. “The message here should be clear: using new technology to break the law does not make you a disruptor, it makes you a criminal.”

Zhao pleaded guilty to one count of failure to maintain an effective anti-money-laundering program in federal court in Seattle. Binance is a Cayman Islands limited liability company.

Binance said in a statement that it made “misguided decisions” as it quickly grew to become the world’s largest crypto exchange and that the settlement acknowledges its “responsibility for historical, criminal compliance violations.”

“Ever since Binance launched its convertible virtual currency platform, it has