Former Binance CEO Changpeng Zhao (CZ) has been moved from his prison to the RRM Long Beach halfway house in California. However, X users and numerous crypto firms have mistakenly interpreted the news to be an early release for Zhao.
Zhao To Be Released In September
CZ was initially being held at FCI Lompoc II prison, also in California. Zhao, who began serving his sentence in late May for violating U.S. anti-money laundering laws, is scheduled to be released on September 29, according to the U.S. Bureau of Prisons. He stepped down as CEO of Binance and as part of the legal resolution, Binance was also fined $4.3 billion, with Zhao personally agreeing to pay a $50 million fine.
While he is now out of prison. But he is certainly still under the custody of the American government and is not free to move or do as he pleases. RRM Long Beach is classed as a ‘residential reentry management (RRM) field office,’ often referred to as a ‘halfway house.’ It is a residential program that prepares inmates approaching the end of their sentences for re-entry into society.
CZ Faces Another Lawsuit
While this sentence might be drawing to a close, he’s now got another lawsuit to worry about. CZ and Binance have been accused by three crypto traders of losing their funds through relaxed money laundering regulations. The suit, which was filed on August 16, claims that Binance’s failure to implement and maintain effective anti-money laundering (AML) and know-your-customer (KYC) rules allowed criminals to move stolen funds to Binance so it could be laundered covertly.
Zhao, one of the wealthiest figures in crypto, is also barred from managing Binance for three years following a settlement with the U.S. government. The entrepreneur intends to use that timespan to focus on other ventures like education and passive investing.
Binance’s Commitment To Regulatory Compliance
This lawsuit could further complicate Binance’s operations, which could lead to increased regulatory oversight and stricter compliance measures in the future. However, in a recent interview, CEO Richard Teng said that Binance would spend a hefty amount on regulatory compliance. He also suggests that the exchange will increase its focus on compliance and has plans to hire more people to achieve that.
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