Changpeng “CZ” Zhao, expected to be released by United States prison authorities in a few weeks, could be permanently enjoined from operating or managing the crypto exchange Binance as part of his plea deal with prosecutors.
According to a Sept. 5 Axios report, Binance CEO Richard Teng said CZ received a lifetime ban from managing or operating the exchange, not just three years, as many news outlets previously reported. The crypto exchange reportedly said the former CEO was barred from a management position at the firm, though it did not appear to be explicitly required by either Zhao’s or Binance’s plea agreements.
CZ’s plea deal
In November 2023, US authorities announced a $4.3 billion settlement with Binance, in which Zhao pleaded guilty to one felony charge related to violations of the Bank Secrecy Act. In April, a judge sentenced the former CEO to four months in prison. He is expected to be released on Sept. 29.
As part of the plea deal, CZ stepped down as Binance’s CEO and was replaced by Teng. Zhao said at the time that he would “remain available to the team to consult as needed” but was stepping down as CEO to let Binance “walk and run.”
According to Binance’s plea agreement filed on Nov. 21, the crypto firm agreed that CZ was prohibited from “any present or future involvement in operating or managing” the exchange. However, the move was listed as a “consideration” for prosecutors as part of the “remedial measures” Binance had taken and not a legal requirement.
Related: Binance is now ‘totally different’: Interview with CEO Richard Teng
Cointelegraph contacted Binance for comment but did not receive a response at the time of publication. Zhao was unavailable for comment.
The settlement required Zhao to personally pay US regulators $50 million. However, Binance’s case with the US Securities and Exchange Commission was ongoing as of September 2024 despite recent Supreme Court opinions that could limit the SEC’s authority in crypto enforcement cases.
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