Founder and former CEO of Binance, Changpeng Zhao, has been given a lifetime ban from leadership roles in the company following an agreement with US authorities over violations.
Changpeng Zhao's Removal
Founder and former CEO of Binance, Changpeng Zhao, has been given a lifetime ban from leadership roles in the company. According to an Axiospro report, Zhao is forbidden from returning to any leadership position at Binance under a deal with US authorities due to legal violations. Last year, the Department of Justice (DOJ) accused Changpeng Zhao of violating U.S. security laws. Specifically, Zhao was found to have failed to maintain an effective anti-money laundering (AML) program, which contravened the Bank Secrecy Act (BSA). As a result of these infractions, Binance faced charges amounting to over $4 billion. In November 2023, Zhao stepped down from his CEO position, succeeded by Richard Teng. Previous reports claimed Zhao would be sentenced to three years in prison, but he was ultimately sentenced to four months. The main condition of the agreement between Binance and US authorities was Zhao's resignation and lifetime ban from any other position within the company. Binance CEO Richard Teng has confirmed that Zhao will never return as a leader of Binance. However, Zhao will continue to hold significant influence in the company as a majority shareholder.
Compliance Under Richard Teng
Binance is currently hiring thousands of new employees, with most positions focused on regulatory compliance. The crypto exchange is investing over $200 million annually in regulatory compliance. Binance CEO Richard Teng has outlined the company's hiring goals for the world's largest crypto trading platform.
Lawsuit Against Binance
In this lawsuit, plaintiffs Philip Martin, Natalie Tang, and Yatin Khanna allege that Binance’s inadequate Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures enabled stolen funds to be laundered through its platform. Although none of the plaintiffs had accounts with Binance, their stolen cryptocurrency ended up on the exchange.
The measures taken to remove Changpeng Zhao and strengthen compliance policies under Richard Teng's leadership indicate Binance's efforts to adhere to regulatory requirements and maintain its status as the leading cryptocurrency platform.
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