Changpeng “CZ” Zhao, a well-known personality in the cryptocurrency business, could receive a 12- to 18-month term based on the U.S. Sentencing Guidelines for breaking US anti-money laundering laws. Nonetheless, it seems that the legal battle for CZ is far from ended, as the Department of Justice (DOJ) has stated that it intends to advocate for a longer duration.
Even after entering a guilty plea and reaching a deal with the DOJ, CZ’s legal battles appear to be getting more intense, according to recent court documents. CZ is presently contesting the government’s attempts to limit his return to the United Arab Emirates (UAE), where he awaits the court’s verdict with his family. CZ is scheduled for sentencing in February 2024.
According to the defense, CZ only faces a “brief” sentence and has no need to run. The high end of the Guidelines range, according to officials, may be as long as 18 months, and the United States is free to advocate for a sentence up to the statutory maximum of ten years. This suggests a potentially harsher punishment.
Legal experts, such as John Reed Stark, a former employee of the Securities and Exchange Commission, have offered assessments that run counter to the DOJ’s proposed longer sentence. Based on the U.S. Sentencing Guidelines, Stark suggests a 12-to 18-month sentence for CZ, which may be served in a minimum-security facility. The DOJ’s inability to secure a deterrent sentence could backfire, according to Stark, who also emphasizes the importance of CZ’s role in the crypto business. Despite this, CZ’s legal team may seek a sentence that combines prison time with home detention and probation.
The DOJ may face obstacles in their quest of a longer prison sentence for CZ. Stark stresses the necessity of strong evidence linking CZ to criminal behavior and raises the question of whether the DOJ is holding information that isn’t public or if additional research could turn up harsher accusations. The case becomes more complicated because CZ was released on a $175 million bond and must return to the United States 14 days prior to his scheduled sentencing on February 24, 2024. Judge Richard A. Jones is anticipated to consider the government’s application and may decide to grant bail or to postpone making a decision.
Breaking News: U.S. DOJ Reveals That Prosecutors May Argue That CZ Should Be Sentenced To 10 Years In Prison— John Reed Stark (@JohnReedStark) November 26, 2023
The U.S. Department of Justice (DOJ) charged ChangPeng Zhao (CZ) with, and CZ pled guilty to, one count of violating the Bank Secrecy Act. The charge stems from a mammoth… pic.twitter.com/gJ5EsB082Q
Within the legal and business communities, the Binance-CZ issue has sparked controversy. Author and adjunct professor at Columbia Business School Omid Malekan notes a significant shift from the DOJ’s customary approach to financial transactions. Malekan suggests that if banks were held to the “Binance Standard,” many managing directors may be sentenced to prison. He does this by drawing comparisons between Binance’s treatment and that of banks.
A huge $4.3 billion settlement was agreed by CZ and the US government on November 21st. The payment was related to claims that CZ had enabled illegal fund transfers via Binance. CZ’s resignation as CEO was a condition of the settlement, which was a turning point in the continuing legal drama involving a major participant in the cryptocurrency space.