Former Binance CEO Changpeng “CZ” Zhao has been ordered to pay $150 million, while Binance will pay $2.7 billion to conclude the CFTC enforcement action.
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Federal Court Enters Order Against Binance and Former CEO, Zhao, Concluding CFTC Enforcement Action: https://t.co/YJD1lglbsZ
— CFTC (@CFTC) December 18, 2023
The approved settlement marks the conclusion of a long-running case against CZ and Binance by the CFTC. The agency sued the executive and his exchange on March 27 for evading federal law and operating an illegal derivatives exchange.
On Nov. 21, CZ agreed to step down from his role at the helm of Binance as part of a wider settlement with the U.S. Department of Justice, the Treasury Department and the CFTC. On the same day, Zhao pleaded guilty to several civil charges and one criminal charge relating to Anti-Money Laundering laws.
As part of the settlement, both CZ and Binance have agreed to take further steps to ensure Know Your Customer measures are maintained on the exchange as well as requiring Binance to implement a formalized corporate governance structure, including a board of directors with independent members, a compliance committee and an audit committee.
The court also made a separate order for Binance’s former chief compliance officer, Samuel Lim, to pay a $1.5 million civil monetary penalty for “aiding and abetting Binance’s violations and engaging in activities outside of the U. S. to willfully evade or attempt to evade U.S. law.”
CZ was succeeded as CEO by Binance’s former global head of regional markets, Richard Teng.
It is an honour and with the deepest humility that I step into the role of Binance’s new CEO.
We operate the world's largest cryptocurrency exchange by volume. The trust placed on us by our 150m users and thousands of employees is a responsibility that I take seriously and hold…
— Richard Teng (@_RichardTeng) November 21, 2023
In an interview with Cointelegraph on Dec. 5, Teng described Binance as being “totally different,” assuring investors that the days of having “gaps in compliance” were now firmly behind it. Teng said that moving forward, Binance was heavily invested in ensuring compliance with regulatory agencies from around the globe.
Over the past 18 months, Binance has been forced to terminate or significantly adjust its core services in several jurisdictions around the globe — including the Netherlands, Cyprus, Australia and Canada.