Crypto News – A US court has ruled against the cryptocurrency exchange Binance and its ex-CEO, Changpeng Zhao, requiring Binance to pay the Commodity Futures Trading Commission (CFTC) $2.7 billion and CZ to pay $150 million.
Ex-CEO CZ to Pay $150 Million Fine as Judge Manish Shah Approves Settlement Against Binance
The CFTC said in a statement on December 18 that the enforcement action it had started in November had come to an end with the approval of the previously disclosed settlement by the U.S. District Court for the Northern District of Illinois.
The court finds Zhao and Binance violated the Commodity Exchange Act (CEA) and CFTC regulations, imposes a $150 million civil monetary penalty personally against Zhao, and requires Binance to disgorge $1.35 billion of ill-gotten transaction fees and pay a $1.35 billion penalty to the CFTC,
CFTC statement
A Brief Summary of the Initiation of the Case
With the authorized settlement, the CFTC‘s protracted legal action against CZ and Binance comes to an end. On March 27, the agency filed a lawsuit against the executive and his exchange for running an unauthorized derivatives exchange and dodging federal law.
CZ consented to resign as the CEO of Binance on November 21 as part of a larger settlement with the CFTC, the Treasury Department, and the U.S. Department of Justice. Zhao entered guilty pleas to multiple civil and one criminal offense pertaining to anti-money laundering legislation on the same day.
Remaining in the United States until his sentencing date of February 23, 2024, was mandated for CZ on December 7. Accused of money laundering, he faces a maximum sentence of eighteen months in jail. He has consented to waive his right to an appeal at that point.
In exchange for settling the dispute, Binance has agreed to establish a formal corporate governance structure that includes an audit committee, a compliance committee, and a board of directors with independent members. CZ has also committed to taking additional actions to guarantee that Know Your Customer policies are upheld on the exchange.
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