After 6 years in charge and a lengthy DOJ investigation, Changpeng Zhao (CZ) will reportedly no longer lead the world’s largest cryptocurrency exchange.
Binance founder Changpeng Zhao (CZ) will plead guilty to floundering anti-money laundering (AML) provisions as part of a settlement deal with the U.S. Department of Justice (DOJ), according to a Tuesday report from the Wall Street Journal (WSJ).
He has also agreed to step down as CEO of his exchange and pay a $50 million personal fine, while Binance has agreed to pay a $4.3 billion fine for its legal violations.
Binance’s Massive Penalty
As detailed by the WSJ, Binance’s alleged crimes included conducting an unlicensed money-transmitting business and failing to maintain an effective AML program.
Meanwhile, CZ is charged with failing to implement an effective AML program under the Bank Secrecy Act.
The company will pay $1.81 billion within 15 months, and another $2.51 billion as part of its DOJ deal, according to Reuters.
The DOJ began its probe into Binance in 2018, only for the IRS and DOJ to start seeking answers from the company in 2021.
Last month, members of Congress began pushing the DOJ to start laying some against the firm. Charges against Binance were first filed on November 14 but only unsealed on Tuesday.
What’s Next for Binance?
CZ has spearheaded Binance since it was founded in July 2017, growing it to be the world’s largest cryptocurrency exchange by trading volume.
A recent study also showed that he was, until now, the most popular man in the crypto community.
A number of fellow Binance executives have already departed the company this year after the exchange laid off 20% of its workforce in May.
Since the announcement, BNB – Binance’s native exchange token – has fallen 5.2% to $240.
Binance still faces lengthy dual lawsuits from the United States’ twin financial regulators alleging that Binance has mishandled customer assets and failed to register as a regulated commodities and securities exchange.
The Securities and Exchange Commission (SEC) also sued U.S.-based crypto exchange Kraken on Monday for similar misconduct.