US Prosecutors Aim to Prevent Ex-Binance CEO 'CZ' Zhao's Departure, Citing Flight Risk
Summary:
US prosecutors are taking steps to prevent ex-Binance CEO, Changpeng "CZ" Zhao, from leaving the country amid fears he may not return for his February 2024 sentencing. Authorities appealed to a Seattle federal court to review a decision allowing Zhao to return to his UAE home on a $175 million bond. They cited concerns about Zhao's wealth, largely held out of reach from US law, and his strong ties to the UAE, a country with no US extradition treaty. Zhao recently admitted shortcomings in maintaining an Anti-Money Laundering scheme at Binance, which led to his departure as CEO and a $50 million penalty.
US legal authorities are making efforts to prevent Changpeng “CZ” Zhao, the former CEO of Binance, from departing the nation, citing worries about the possibility of him eluding justice. The recent developments reveal that the US prosecution on November 22 petitioned a federal court based in Seattle to scrutinize and invalidate a ruling which would enable Zhao to go back to his residence in the United Arab Emirates (UAE), backed by a hefty $175 million bond. The stipulation was that he would come back to the US a fortnight before his sentencing in February 2024.
The prosecution, in their submitted order proposition, conveyed that Zhao might pose a significant jeopardy of absconding or remaining absent if he is permitted to exit the US before his sentencing. This concern was reiterated in a supplementary letter by the prosecutors, stating that if Zhao did not return voluntarily, the authorities would be unable to ensure his return.
Highlighting Zhao's strong connections to and high-regarded status in the UAE along with the absence of any extradition agreement between the UAE and the US, they appealed to withhold him from leaving the nation. The letter also mentioned Zhao's family ties in the UAE, "He has three young children and a partner in the UAE; upon reaching the UAE and faced with the threat of a prison sentence of up to 18 months in the US, he might choose simply to remain in the UAE with his family."
Furthermore, the prosecution highlighted that, given Zhao's significant wealth, largely held out of reach from US law, he could sustain life in the UAE indefinitely. They also maintained that the $175 million bond used for Zhao's release was not sufficient as most of it was beyond US jurisdiction.
Zhao has recently pledged guilty to not sustaining an effective Anti-Money Laundering scheme at Binance, leading to his resignation as the CEO of the exchange and incurring a $50 million penalty.
A silver lining for the crypto industry comes from the partial resolution of Binance's case with the Department of Justice, which has been considered a positive turn of events by industry analysts and watchers, considering it adds more validation for cryptocurrency within the US. Subsequent to the negativity due to the events surrounding one of its key figures, the cryptocurrency market has bounced back, with the total market capitalization attaining its previous levels before the Binance incident, reaching $1.48 trillion during Thursday's Asian trading round.
Published At
11/23/2023 4:58:29 AM
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