Former Binance CEO Barred from Leaving U.S. Before Sentencing
| By Loc Le |
In a ruling imposed by U.S. District Judge Richard Jones on Thursday, December 7th, the founder and former CEO of Binance, Changpeng Zhao, has been denied his request to leave the U.S. and return to his home in the United Arab Emirates before his criminal sentencing. This decision reverses a previous ruling made by Magistrate Judge Brian Tsuchida on November 21st that allowed Zhao to leave the U.S. as long as he returned to the country 14 days before his sentencing hearing that is scheduled for February 23, 2024.
Zhao’s sentencing comes in light of his pleading guilty to violating the Bank Secrecy Act by allowing Binance customers “to use the platform without conducting proper know-your-customer or anti-money laundering checks” by the financial institution. As a result, the Treasury Department claimed that Binance has allowed criminals “to transact freely, supporting activities from child sexual abuse to illegal narcotics to terrorism,” citing examples of suspicious transactions from terrorist groups such as Hamas, al Qaeda, and ISIS that were never reported.
Despite arguments made by Zhao’s lawyers that he is not a flight risk due to his voluntary choice of coming to the U.S. to accept responsibility for his actions and a substantial $175 million personal recognizance bond that is secured by $15 million in cash, federal prosecutors still did not want Zhao to leave the country and return to his home. They believed that Zhao’s status as a multi-billionaire with significant assets and the fact that there is no extradition treaty with the United Arab Emirates would make it difficult to secure his return to the U.S. if he decided not to come back for his sentencing. Unfortunately for Zhao, these reasons took priority in U.S. District Judge Richard Jones’ decision to reverse the previous ruling and keep him confined within the country.
Although Jones did address the arguments made by Zhao’s lawyers and stated that they would be sufficient in most cases, Zhao’s case was deemed to be “unusual,” thus the unprecedented decision. According to the six-page order that Jones wrote, “the defendant has enormous wealth and property abroad, and no ties to the United States. His family resides in the UAE and it appears that he has favored status in the UAE.” For such reasons, “the Court finds that the defendant has not established by clear and convincing evidence that he is not likely to flee if he returns to the UAE.”