The US Department of Justice (DoJ) has claimed that former Binance CEO Changpeng ‘CZ’ Zhao should face three years in prison on money laundering charges, ahead of his April 30 sentencing.
According to a sentencing brief filed Tuesday, lawyers for the Department of Justice propose that the court “impose an above-Guidelines sentence of 36 months imprisonment,” citing Zhao’s “willful violation of U.S. law.”
The former Binance CEO gambled “that he would not get caught, and that if he did, the consequences would not be as serious as the crime,” the DoJ’s lawyers argued, and that Binance’s “Wild West” strategy of failing to comply with US anti-money-laundering requirements had made Zhao “one of the richest people in the world and a celebrity in the cryptocurrency industry.”
The 36-month sentencing suggestion exceeds federal sentencing standards, which would have resulted in an 18-month prison sentence for the former Binance CEO. The DoJ recommended a harsher-than-expected sentence for Zhao, stating that it would “not just send a message to Zhao but also to the world,” acting as a deterrence to others.
Under Zhao’s leadership, Binance grew to become the world’s largest cryptocurrency exchange by volume. He resigned as CEO of Binance in November 2023 after pleading guilty to US money laundering and sanctions violations as part of a settlement with the Department of Justice. The deal required Binance to pay $4.3 billion in penalties and ‘totally depart’ the United States.
Zhao was also forced to pay $50 million in fines under the terms of his plea agreement, and he was barred from any involvement in Binance for at least three years.
Zhao was ordered to post a $175 million bond before his sentencing at the end of the month. U.S. District Judge Richard Jones issued travel restrictions on the former Binance CEO, banning him from leaving the country after prosecutors determined he was a flight risk.
The exchange is still facing a lawsuit from the United States Securities and Exchange Commission (SEC), which it sought to dismiss in a series of filings in December.