The Commodity Futures Trading Commission (CFTC) has reached a settlement with CZ Zhao, the former CEO of Binance, and Binance itself, following a legal action against the cryptocurrency exchange. The US District Court for the Northern District of Illinois has authorized the settlement, which requires CZ Zhao to pay $150 million and Binance to pay $2.7 billion to the CFTC.
The court found that both Zhao and Binance violated the Commodity Exchange Act (CEA) and CFTC regulations. As part of the settlement, Zhao has resigned as the CEO of Binance and pleaded guilty to civil and criminal offenses related to anti-money laundering legislation. He will remain in the United States until his sentencing date in February 2024.
In addition to the financial penalties, Binance has agreed to establish a formal corporate governance structure, including an audit committee, a compliance committee, and a board of directors with independent members. Zhao has also committed to taking further actions to ensure that Know Your Customer policies are upheld on the exchange.
The settlement brings an end to the CFTC’s protracted legal action against CZ Zhao and Binance, which began in March 2021 when the agency filed a lawsuit against them for running an unauthorized derivatives exchange and evading federal law.
It is worth noting that Binance has faced regulatory challenges in various international jurisdictions over the past 18 months, leading to the discontinuation or significant alteration of its services in countries such as the Netherlands, Cyprus, Australia, and Canada.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | 🇺🇸 🇳🇱 🇨🇾 🇦🇺 🇨🇦 |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Samuel Lim, CZ Zhao |
| Companies | Binance, Treasury Department, US District Court for the Northern District of Illinois, US Department of Justice, CFTC |
| Currencies | US Dollar |
| Securities | None |
