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DOJ Says Changpeng Zhao Not a Flight as Court Battle Heats Up

After stepping down as CEO of Binance, Changpeng Zhao now faces a legal battle over how his company's services were being used.

CZ faces a court battle against the DOJ over Binance's operations.
Credit: Bloomberg/Getty Images

WASHINGTON D.C. – The U.S. Department of Justice (DOJ) has recently been in the spotlight due to its stance on the case involving Changpeng 'CZ' Zhao, the former CEO of Binance. The DOJ, in a new filing, has expressed concerns about Zhao being a flight risk, albeit one that can be managed within the United States. Accusations include failure to stop anti-money laundering that took place through Binance.


The DOJ's Concerns and Arguments


The Department of Justice has articulated a clear stance: while they do not wish to incarcerate Zhao prior to sentencing, they also oppose his departure from the U.S. The key argument hinges on Zhao being a significant flight risk.


This assertion is based on several factors, including the potential severity of the sentence Zhao faces and his strong connections outside the U.S., particularly in the United Arab Emirates (UAE), a nation without an extradition treaty with the United States.


Zhao's Defense and Counterarguments


Contrasting the DOJ's position, Zhao's legal counsel has put forth a compelling argument regarding his willingness to face legal proceedings. They emphasize that Zhao, holding UAE and Canadian citizenship, voluntarily entered the U.S. to appear in court, demonstrating his intent not to flee. Additionally, they reference a substantial bail package proposed by Zhao, which was acknowledged by Judge Tsuchida as a factor negating the risk of flight.


The Impact of Zhao's Guilty Plea


In a significant development, Zhao pleaded guilty to violating anti-money laundering laws in the U.S. Concurrently, Zhao stepped down as CEO of Binance. This move, coupled with Binance's admission of guilt to multiple criminal and civil charges and its agreement to pay a hefty $4.3 billion in penalties, marks a monumental moment in U.S. legal history. These penalties rank among the largest corporate fines ever imposed by the Department of Justice.

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