US Judge Prohibits Changpeng Zhao From Exiting the United States

Judge Richard Jones wrote that the respondent has a lot of property and wealth out of the country and lacks links to the U.S.

On Thursday, a federal judge in Seattle said that Changpeng ‘CZ’ Zhao, Binance’s founder, should stay in the U.S. as he awaits his sentencing on criminal charges associated with anti-money laundering contraventions. 

Judge Overturns Previous Ruling to Prohibit Zhao Exiting US

Richard Jones, a United States District Judge, approved a request by federal prosecutors to implement travel limits on Zhao. Earlier, he had acquired a different ruling that permitted him to travel back to the United Arab Emirates (UAE) before his February sentencing. 

Jones overturned that verdict by saying that the defendant’s ‘vast wealth’ abroad and the absence of a repatriation agreement between the United States and the United Arab Emirates made him a flight risk. In his ruling, the judge wrote that he and the government agreed that Zhao’s case is uncommon. Besides, he wrote that he owns vast property and wealth overseas and lacks links to the U.S.

According to prosecutors, the 45-year-old must stay in the United States since he might easily escape and sustain financial damages linked to the loss of his $175M bond as well as an extra $5M in security. Further, the prosecutors claimed that Zhao might be protected by the UAE government from United States repatriation efforts because of his residency and citizenship status.  

Zhao’s legal team dismissed these concerns, emphasizing the accused’s readiness to surrender and acknowledge the offense. In the meantime, the government reiterated that Zhao would be okay. Jones wrote that according to the bond requirements, the accused remains free and can move within the U.S. Besides, his family can visit him in the U.S. These bond conditions are not heavy impositions on Zhao’s freedom as he awaits sentencing.

Despite Jones siding with the government’s stance, his ruling clearly showed that the decision was not founded on the accused’s ‘citizenship or alienage.’ Zhao aided in Binance’s launch in 2017 and afterward moved the firm’s operations to the Cayman Islands and Malta. 

Authorities in the United States have probed the exchange for promoting unlawful transactions. In 2022, Binance claimed it would play millions in penalties as well as forfeitures due to the ‘deliberate failure’ to protect against money laundering and other illegal activities. This happened despite no people facing charges until Zhao’s prosecution last month.

Prosecutors Plea for Zhao Remain in US Until Sentencing

United States District Judge Richard Jones’s verdict extends a previous ruling that would have permitted Zhao to return to his family in the UAE. Prosecutors cautioned he might escape owing to his wealth and the lack of a repatriation treaty with the United Arab Emirates.

Last week, a Department of Justice (DOJ) representative revealed to a news agency that the accused could go back to the United Arab Emirates after Monday evening while waiting for his sentencing. However, the prosecutors stressed that he was a risk flight, in spite of him putting up a substantial $175M bond and admitting to wrongdoing.

In his Thursday ruling, Jones wrote that the court and the government agree this case is atypical. He cited the accused’s ‘vast wealth and property overseas’ as reasons to execute travel restrictions. The ongoing legal drama originates from federal probes indicating how Binance, the globe’s biggest crypto exchange, facilitated illicit transactions.

Court Disregards Zhao Goodwill to Answer Charges in US

Zhao resigned as the chief executive officer in November after the firm reached a $4.3B settlement linked to sanctions and money transfer contraventions. Based on his plea deal with the DOJ, Zhao faces up to a decade behind bars and fines amounting to $50M. 

Earlier, Zhao’s legal team asserted he had already demonstrated accountability by flying to the United States to answer charges. They claimed that relocating his family just for February’s sentencing was needless. However, federal prosecutors finally persuaded the judge that Zhao intended to escape more legal penalties in spite of losing substantial bonding money. 

It is uncertain whether or when Jones is likely to plan a bond hearing. At the moment, the besieged Zhao is limited to United States soil as he awaits his sentencing, the most recent for a sector affected by crypto’s ambiguous legal status.