![Binance founder and ceo to step down](https://i0.wp.com/cryptoreach.io/blog/wp-content/uploads/2023/11/Add-a-heading-2.webp?fit=1920%2C1080&ssl=1)
Founder Changpeng Zhao, now ex-CEO of one of the biggest crypto exchanges, ‘Binance’, has stepped down from his chief executive officer role after pleading guilty to federal charges in violation of the Bank Secrecy Act (BSA).
The settlement amounts to a huge sum of $4.3 billion that has to be settled with the U.S. Department of Justice (DOJ). The conclusion came after years of investigation into Binance.
The actual reason cited was that Binance had failed to implement countermeasures for money laundering (AML) and Know-Your-Customer (KYC) procedures as well.
This created a gateway for criminal and even terrorist organizations to launder money and evade sanctions and Binance failed to report at least 100,000 of these types of illicit transactions.
U.S. Attorney General Merrick Garland said, “Binance made it easy for criminals to move their stolen funds and illicit proceeds on its exchanges.” “Binance also did more than just fail to comply with federal law. It pretended to comply.”
![changpeng zhao](https://i0.wp.com/cryptoreach.io/blog/wp-content/uploads/2023/11/changpeng-zhao-the-ceo-of-binance-plans-to-step-down-and-v0-EI85Y8K7xgnQHPw10_qx2ZsZvg_zRiY7KsfKCAVEKas.webp?fit=1080%2C540&ssl=1)
Apart from stepping down as CEO, Changpeng Zhao personally has to pay a $50 million fine.
Furthermore, The former Chief Compliance Officer (CCO) of Binance, Samuel Lim, also has to pay a separate settlement of $10 million after pleading guilty to violation of BSA.
Key Takeaways of the Settlement
- Chengpeng Zhao will step down as CEO and will also have to pay a $50 million fine.
- Zhao won’t be able to manage and operate any business for 3 years.
Former Chief Compliance Officer Samuel Lim to pay a fine of $10 million. - Binance has to pay a $1.5 billion civic penalty to the U.S. Treasury.
- An additional $2.8 billion will also be levied from Binance.
Official Statement from Changpeng Zhao
“I take full responsibility for the actions that led to this settlement, and I deeply regret the mistakes we made. We have been working hard to improve our compliance programs, and we are committed to cooperating with the DOJ and other regulatory bodies to ensure that we meet the highest standards.”
Commitment from Binance
- Implement new anti-money laundering (AML) and know-your-customer (KYC) training for all employees.
- Hire a new Chief Compliance Officer with strong knowledge of AML and KYC.
- Double the number of compliance personnel.
- Implement new transaction monitoring systems for more security.
Greetings, I’m Akriti Gupta, a recent graduate from Delhi University. My pursuit in life revolves around an insatiable curiosity to explore and acquire new knowledge, fostering personal growth while nurturing a sense of compassion and goodness within me. Among my passions, painting, calligraphy, doodling, and singing stand as the cornerstones of my creative expression. These hobbies not only serve as outlets for my imagination but also as mediums through which I continually learn and evolve.