Richard Teng has been appointed CEO of crypto exchange Binance, following the resignation of Changpeng Zhao (CZ) who pleaded guilty to criminal charges for anti-money laundering and violations of U.S. sanctions.
Teng, previously serving as the Global Head of Regional Markets at Binance, is known for his extensive experience in the financial services and regulatory fields.
His appointment is seen as a strategic move to strengthen Binance’s compliance and regulatory frameworks, a critical need in the wake of the legal challenges faced by the company.
Teng’s previous roles include CEO of the Financial Services Regulatory Authority at Abu Dhabi Global Market (ADGM), Chief Regulatory Officer at the Singapore Exchange (SGX), and Director of Corporate Finance at the Monetary Authority of Singapore (MAS).
Binance’s Violations of U.S. Anti-Money Laundering and Sanctions Laws
The transition at the top of Binance is a direct consequence of a historic settlement involving the Financial Crimes Enforcement Network (FinCEN), the Office of Foreign Assets Control (OFAC), and IRS Criminal Investigation (CI) for violations of U.S. anti-money laundering and sanctions laws.
Under the terms of the settlement, Binance has agreed to pay US$3.4 billion to FinCEN and US$968 million to OFAC, representing the largest penalties in the history of these U.S. regulatory bodies. The deal will see Zhao personally pay US$50 million.
The U.S. Treasury said that the violations include failure to implement programmes to prevent and report suspicious transactions with terrorists — including Hamas’ Al-Qassam Brigades, Palestinian Islamic Jihad (PIJ), Al Qaeda, and the Islamic State of Iraq and Syria (ISIS) — ransomware attackers, money launderers, and other criminals, as well as matching trades between U.S. users and those in sanctioned jurisdictions like Iran, North Korea, Syria, and the Crimea region of Ukraine.
As part of the settlement agreement, Binance will be subject to 5 years of monitoring and “significant compliance undertakings” to ensure the crypto exchange’s complete exit from the United States.
Janet L. Yellen
“Binance turned a blind eye to its legal obligations in the pursuit of profit. Its willful failures allowed money to flow to terrorists, cybercriminals, and child abusers through its platform.
Today’s historic penalties and monitorship to ensure compliance with U.S. law and regulations mark a milestone for the virtual currency industry. Any institution, wherever located, that wants to reap the benefits of the U.S. financial system must also play by the rules that keep us all safe from terrorists, foreign adversaries, and crime, or face the consequences,”
said Secretary of the Treasury Janet L. Yellen.
CZ faces a maximum sentence of 10 years in prison, but he is likely to receive a significantly lighter sentence under a plea deal according to Bloomberg. The Justice Department has yet to determine the specific prison term they will seek for CZ.
He has posted a US$175 million release bond that will require him to return to the United States two weeks before his sentencing on 23 February 2024, according to Cointelegraph.
This arrangement potentially allows him to return to Dubai, where he has been based for several years. Should he fail to appear in court, CZ would face a US$250,000 fine and a maximum of 10 years in jail.
CZ said “it was not easy to let go emotionally”
He made a statement on X where he acknowledged the emotional difficulty of stepping down but emphasised the necessity of taking responsibility for the company’s past missteps.
CZ expressed confidence in Teng’s leadership abilities, emphasising his qualifications and experience as crucial for guiding Binance through its “next phase of security, transparency, compliance, and growth”.
As for CZ, he spoke of taking a break and potentially venturing into passive investing in areas such as blockchain, Web 3.0, DeFi, AI, and biotech. He also indicated interest in privately mentoring upcoming entrepreneurs. No mention was made about him potentially serving jail time.
Today, I stepped down as CEO of Binance. Admittedly, it was not easy to let go emotionally. But I know it is the right thing to do. I made mistakes, and I must take responsibility. This is best for our community, for Binance, and for myself.
Binance is no longer a baby. It is…
— CZ 🔶 Binance (@cz_binance) November 21, 2023
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- Source: https://fintechnews.sg/80926/crypto/richard-teng-named-binance-ceo-amidst-czs-criminal-charges-us4-3b-fine/
