After reaching a settlement and pleading guilty with the US Department of Justice (DOJ), among other regulatory agencies, in November last year, Binance was officially approved by the court on the 23rd to pay a fine of $4.3 billion, setting a record for the largest fine in a cryptocurrency criminal case. However, the lawsuit between Binance and the SEC is still ongoing.
In November last year, Binance reached a settlement and pleaded guilty with the DOJ, Commodity Futures Trading Commission (CFTC), Office of Foreign Assets Control (OFAC), and Financial Crimes Enforcement Network (FinCEN). The court officially approved the previously announced settlement agreements between these institutions and Binance, requiring Binance to pay a fine of $4.3 billion, making it the largest fine in the history of cryptocurrency criminal cases.
In November last year, Binance admitted to allowing transactions with Hamas and other terrorist organizations on its platform and confessed to three charges, including money laundering, operating an unlicensed money transmission business, and violating US sanctions. Founder CZ admitted to violating the Bank Secrecy Act and is expected to be sentenced on April 30.
Binance spokesperson: Significant implementation of the settlement agreement
According to The Block, a Binance spokesperson stated in a statement that as part of the agreement, the US Department of Justice and the Financial Crimes Enforcement Network required Binance to appoint an “independent monitor,” with the Department of Justice requiring the monitor to be maintained for at least 3 years and the Financial Crimes Enforcement Network requiring 5 years. In addition, Binance also needs to appoint a new CEO, which has been taken over by Richard Teng, who has extensive regulatory experience.
On the 16th, Bloomberg quoted insiders as reporting that Binance’s independent monitor may be promoted from the New York law firm Sullivan & Cromwell, which is responsible for the FTX bankruptcy case. The firm’s partner and former federal prosecutor Sharon Cohen Levin may lead the monitoring team for Binance.
Ongoing lawsuit with the US SEC
However, the lawsuit between Binance and the US Securities and Exchange Commission (SEC) is still ongoing. In June of last year, the SEC filed a lawsuit against Binance Holdings, Zhao Changpeng, Binance US, and others, bringing 13 charges against the defendants, accusing them of operating an unregistered exchange, illegally offering and selling securities to US investors, mishandling customer funds, etc.
Binance attempted to dismiss the SEC lawsuit. On January 22, a 4-hour hearing was held between Binance and the SEC at the US District Court for the District of Columbia, citing the “major questions doctrine,” which states that an institution needs explicit instructions from Congress to issue rules with significant economic or political impact.
However, Judge Amy Berman Jackson questioned Binance’s position and asked Binance’s lawyer how they believed the SEC lacked the authority to apply securities laws to cryptocurrencies. She also did not believe that this case fell under the major questions doctrine. The judge has not yet decided whether to dismiss the case.