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Binance founder Changpeng Zhao urges judge to let him leave the U.S. before sentencing—after the DOJ scrambles to stop him



The lawyers for former Binance CEO Changpeng Zhao insist the crypto billionaire is not a flight risk. The Justice Department isn’t so sure.

On Tuesday, the U.S. government announced criminal charges against Binance and its leader. The world’s biggest cryptocurrency exchange agreed to pay $4.3 billion in penalties, among the largest fines in corporate history. It also pleaded guilty to anti-money laundering and U.S. sanctions violations. But it avoided a death sentence and will be allowed to continue operating.

Binance failed to report over 100,000 suspicious transactions with organizations the U.S. described as terrorist groups, among them Hamas, al Qaeda, and the Islamic State of Iraq and Syria, according to U.S. authorities. And it illegally profited by letting “darknet” actors and ransomware hackers operate on the platform, they added.

When contacted by Fortune about the settlement, a spokesperson for Binance shared a blog post reading in part: “These resolutions acknowledge our company’s responsibility for historical, criminal compliance violations, and allow our company to turn the page on a challenging yet transformative chapter of learning and growth.”

As for Zhao, the billionaire agreed to step down as CEO and pay a $50 million fine, and he pleaded guilty to failure to protect against money laundering. Scheduled to be sentenced on Feb. 23, he faces up to a decade in prison but under a plea deal is expected to get no more than 18 months.

Zhao, a citizen of Canada and the United Arab Emirates, hopes to travel to his home in the UAE ahead of the sentencing, with his lawyers saying he wants to prepare his partner and three children for his sentencing. But if he decides to never come back, prosecutors warned on Wednesday, the U.S. government might be unable to secure his return because it has no extradition treaty with the UAE—and the billionaire has “significant assets,” it noted.

“In the vast majority of cases, a multi-billionaire defendant who has pleaded guilty, faces possible prison time, and lives in a country that does not extradite its citizens to the United States would be detained,” said Justice Department lawyers.

The DOJ said in a brief on Friday that while it recommended Zhao remain free before sentencing, that was because it believed travel restrictions could make him less of a flight risk. Instead, on Tuesday magistrate judge Brian Tsuchida set bail conditions, over DOJ objections, that allow for the Binance founder to leave the U.S. 

On Wednesday, the Justice Department asked U.S. district judge Richard Jones to reverse those bail conditions. The following day, Zhao’s lawyers asked him not to, noting that their client voluntarily came to the U.S. to accept responsibility for his actions. Jones is expected to rule on the matter by Monday.

Meanwhile Binance this week announced that Richard Teng, its global head of regional markets, would replace Zhao as CEO. Teng tweeted that his focus would be on “collaborating with regulators” in addition to “reassuring users.” 

As for Zhao, he posted on Tuesday: “What’s next for me? I will take a break first. I have not had a single day of real (phone off) break for the last 6 and half years.”

How his sentencing and presumed jail time plays into that remains to be seen.

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