Adedapo Adesanya
By Adedapo Adesanya
The embattled founder of the largest cryptocurrency exchange in the world, Binance, Mr Changpeng Zhao, is facing three years in prison over money laundering charges.
The tech tycoon, popularly known as CZ will be sentenced on Tuesday after pleading guilty to the charges last year with US prosecutors seeking the sentence for the 47-year-old.
Mr Zhao stepped down as chief executive of Binance in November after admitting to breaking US anti-money laundering laws.
The US prosecutors requested a 36-month sentence in a filing in Seattle federal court last week, arguing that sentencing the Binance founder to twice the maximum 18 months recommended under federal guidelines would reflect the gravity of his offences, and send a message.
The court filing also said Binance operated on a “wild west” model under Mr Zhao’s leadership, failing to report more than 100,000 suspicious transactions due to poor internal controls. The suspect trades included transactions with designated terrorist groups Hamas, al-Qaida and ISIS.
“Zhao’s willful violation of US law was no accident or oversight. He made a business decision that violating US law was the best way to attract users, build his company, and line his pockets,” said the prosecutors.
Mr Zhao agreed to step down as Binance CEO after he and the company admitted breaching the Bank Secrecy Act. The exchange also agreed to pay a financial penalty of $4.3 billion while Mr Zhao was fined $50 million.
In Nigeria, Binance is also under heavy scrutiny with the Economic and Financial Crimes Commission (EFCC) accusing Binance’s executives – Mr Tigran Gambaryan and Mr Nadeem Anjarwalla, of laundering $35.4 million.
In February, Mr Gambarayan, who is in charge of financial crime compliance at Binance, and Mr Anjarwalla, who is Binance’s Africa Regional Manager, were detained after arriving in Nigeria for meetings to discuss the platform’s operations in the country.
Binance was later that week ordered to pay a fine of $10 billion after the Nigerian government accused it of currency speculation and fixing exchange rates, leading to the free-fall of the Naira.
