Binance, the world’s largest cryptocurrency exchange, reached a settlement agreement with the US Department of Justice (DOJ) last year. As part of the settlement, Binance was required to appoint an independent monitor recommended by the DOJ and approved by US regulatory agencies. It has now been reported that Sullivan & Cromwell, a law firm based in New York responsible for the FTX bankruptcy case, will be appointed as Binance’s independent monitor.
According to Bloomberg, a source familiar with the selection process stated that Sullivan & Cromwell, led by partner and former federal prosecutor Sharon Cohen Levin, is likely to be chosen as Binance’s independent monitor, surpassing numerous other lawyers and consultants. Another insider revealed that although the appointment has not been officially announced, Sullivan & Cromwell is being given priority consideration, and the DOJ is close to approving the law firm as Binance’s independent monitor.
The settlement agreement requires the appointment of an independent monitor for Binance. In November last year, Binance reached a settlement agreement with the DOJ and other institutions, pleading guilty and agreeing to pay a $4.3 billion fine. As part of the settlement, the DOJ and the Financial Crimes Enforcement Network (FinCEN) of the Department of the Treasury both required Binance to appoint an independent monitor. The DOJ mandated a minimum of 3 years for the independent monitor, while FinCEN required 5 years.
The role of the monitor is to ensure that Binance complies with its plea agreement and takes measures to address deficiencies in its anti-money laundering and sanctions programs. The monitor will have access to a significant amount of information, including company records, facilities, and employees, and will be responsible for conducting reviews using this data and submitting regular reports to the government.
The report mentioned that being appointed as a monitor is a lucrative opportunity for the chosen company, especially considering the amount of work required to oversee a large and complex company like Binance. In the past few months, many consulting firms and law firms have been vying for this position.
Binance has been required to bring its compliance program up to standard, including the reevaluation and reporting of tens of thousands of suspicious transactions. The US Department of the Treasury has accused Binance of intentionally ignoring these suspicious transactions in the past. Zhao Changpeng, the CEO of Binance, has admitted to violating banking laws and is scheduled to be sentenced in April this year.
Sharon Cohen Levin is a recognized expert in anti-money laundering and sanctions. She previously led the Money Laundering and Asset Forfeiture Unit at the US Attorney’s Office in Manhattan and also represented Goldman Sachs in the 1MDB corruption scandal involving the Malaysian sovereign wealth fund.
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