Former Binance CEO Changpeng Zhao’s legal team is urging a U.S. judge to deny the Justice Department’s request preventing him from returning to his home in the United Arab Emirates until his sentencing for violating anti-money laundering regulations. In a filing on Thursday, Zhao’s lawyers requested U.S. District Judge Richard Jones in Seattle to uphold the bail conditions set by a magistrate judge on Tuesday, allowing Zhao to depart the U.S. while awaiting sentencing.
Zhao, a citizen of the UAE and Canada, resigned as Binance CEO on Tuesday after pleading guilty to willfully causing the global cryptocurrency exchange to fail in maintaining an effective anti-money laundering program. U.S. authorities accused Binance of breaking U.S. anti-money laundering and sanctions laws, failing to report over 100,000 suspicious transactions with organizations identified as terrorist groups, including Hamas, al Qaeda, and the Islamic State of Iraq and Syria.
As part of a plea deal, Binance agreed to pay over $4.3 billion, and Zhao agreed to a $150 million penalty to the U.S. Commodity Futures Trading Commission. Prosecutors, in a Wednesday filing, indicated he could face up to 18 months in prison.
The Justice Department has requested Judge Jones to overturn a decision by U.S. Magistrate Judge Brian Tsuchida, who permitted Zhao to return to the UAE before his Feb. 23 sentencing under a $175 million bail bond. The government expressed concerns about Zhao not returning for sentencing, given the absence of an extradition treaty with the UAE and Zhao’s substantial assets as a multi-billionaire.
Zhao’s legal team countered that he had demonstrated he was not a flight risk by accepting a significant bail package and voluntarily coming to the U.S. to take responsibility for his actions. They argued that allowing Zhao to return to the UAE would enable him to care for his partner and three children and prepare them for his sentencing.
In response, the Justice Department, in a brief on Friday, defended its decision to recommend Zhao remain free before sentencing as “exceptional,” citing the belief that the risk of flight could be “managed” by restricting his travel. They emphasized that in most cases, a billionaire defendant who pleaded guilty and lived in a non-extradition country would be detained.