Prosecutors want Binance’s CZ kept on tighter leash ahead of sentencing

U.S.

prosecutors
Friday
asked
a
judge
to
tighten
the
bond
conditions
of
billionaire


Binance
founder
Changpeng
“CZ”

Zhao
as
he
awaits

his
April
sentencing
for
breaking
a
federal
anti-money
laundering
law,
court
filings
show.

Zhao

pleaded
guilty
in
late
November
to
a
charge
of
failure
to
maintain
an
effective
anti-money
laundering
program
in
violation
of
the
Bank
Secrecy
Act,
and
stepped
down
as
Binance’s
CEO
at
the
same
time.

Under
the
proposed
bond,
Zhao
would
be
required
to
provide
prosecutors
and
pretrial
services
with
at
least
three
days’
notice
before
any
travel
within
the
country,
to
give
them
time
to
raise
any
potential
objections.

The
new
bond
conditions
would
also
order
Zhao
to
surrender
his
current
Canadian
passport,
and
they
would
bar
him
from
applying
for
a
new
one
without
the
court’s
permission.
He
would
also
be
barred
from
changing
his
place
of
residence
without
prior
approval.

Zhao’s
lawyers
objected
to
the
proposal,
according
to
the
filing.
An
attorney
for
Zhao
did
not
immediately
respond
to
CNBC’s
request
for
comment.

Judge
Richard
Jones
barred
Zhao
from
traveling
outside
the
United
States
in
mid-December,
after
determining
that
Zhao’s
“enormous
wealth”
and
lack
of
U.S.
ties
created
a
risk
that
he
might
flee
if
allowed
to
return
to
his
home
in
the
United
Arab
Emirates.

The
prosecutors’
latest
filing
in
U.S.
District
Court
in
Seattle
noted
that
pretrial
services
officers
have
recommended
further
restricting
Zhao’s
movement,
allowing
him
to
travel
only
to
the
western
district
of
Washington
and
the
district
where
he
currently
resides.

Pretrial
Services
also
recommended
“a
location-monitoring
condition,”
the
filing
said
in
a
footnote.
The
filing
does
not
explicitly
ask
the
judge
to
impose
that
condition.

Zhao,
a
Canadian
national,
is
free
in
the
U.S.
on
a
$175
million
personal
recognizance
bond.
His
attorneys
have
argued
that
he
has
taken
responsibility
for
his
actions,
noting
that
he
is
paying
a
personal
penalty
of
$150
million
to
the
U.S.
Commodity
Futures
Trading
Commission
as
part
of
his
agreement
with
the
government.

The
Department
of
Justice
announced
Zhao’s
guilty
plea
in
tandem
with
an
agreement
by
Binance
to
pay
more
than
$4.3
billion
to
resolve
multiple
federal
charges.
Attorney
General
Merrick
Garland
at
the
time
called
it
“one
of
the
largest
corporate
penalties
in
U.S.
history.”

Federal
sentencing
guidelines
suggest
Zhao
could
face
up
to
18
months
in
prison.

Prosecutors have
reportedly
considered
asking
for
a
harsher
sentence.

A
Dec.
22
letter
to
the
court,
made
public
with
redactions
in
late
January,
revealed
that
Zhao
had
asked
to
return
to
the
UAE
for
up
to
four
weeks
to
attend
to
someone
in
his
life
who
was
scheduled
to
undergo
surgery.

Zhao
offered
to
pledge
all
of
his
equity
in
Binance
US
in
order
to
assuage
concerns
about
his
potential
risk
of
flight,
the
letter
showed.
That
equity
was
worth
$4.5
billion
as
of
the
company’s
most
recent
round
of
fundraising
two
years
earlier,
Zhao’s
lawyers
said
in
the
letter.

Jones
denied
the
travel
request
on
Dec.
29.