US court approves settlement against Binance, firm to pay $2.7B to CFTC

A United States court has entered an order against crypto exchange Binance and its former CEO Changpeng “CZ” Zhao, which will see Binance pay $2.7 billion and CZ pay $150 million to the Commodities Futures and Trading Commission (CFTC).

In a Dec. 18 statement, the CFTC announced that the U.S. District Court for the Northern District of Illinois had approved the previously announced settlement and concluded the enforcement action first issued by the CFTC in November. 

“The court finds Zhao and Binance violated the Commodity Exchange Act (CEA) and CFTC regulations, imposes a $150 million civil monetary penalty personally against Zhao, and requires Binance to disgorge $1.35 billion of ill-gotten transaction fees and pay a $1.35 billion penalty to the CFTC,” wrote the CFTC in a statement. 

The approved settlement marks the conclusion of a long-running case against CZ and Binance by the CFTC. The agency charged the executive and his exchange on March 27 for evading federal law and operating an illegal derivatives exchange. 

On Nov. 21, CZ agreed to step down from his role at the helm of Binance as part of a wider settlement with the U.S. Department of Justice, the Treasury, and the CFTC. On the same day, Zhao pleaded guilty to several civil charges and one criminal charge relating to anti-money laundering laws. 

Related: Binance CEO outlines plan for crypto exchange after CZ steps down

As part of the settlement, both CZ and Binance have agreed to take further steps to ensure KYC measures are maintained on the exchange as well as requiring Binance to implement a formalized corporate governance structure, including a board of directors with independent members, a compliance committee, and an audit committee.

The court also made a separate order for Binance’s former chief compliance officer Samuel Lim to pay a $1.5 million civil monetary penalty for “aiding and abetting Binance’s violations and engaging in activities outside of the U. S. to willfully evade or attempt to evade U.S. law.”

CZ was succeeded as CEO by Binance’s former global head of regional markets Richard Teng.

In an interview with Cointelegraph on Dec. 5, Teng described Binance as being “totally different” assuring investors that the days of having “gaps in compliance” were now firmly behind it. Moving forward, Teng said Binance was heavily invested in ensuring compliance with regulatory agencies from around the globe. 

Over the past 18 months, Binance has been forced to terminate or significantly adjust its core services in several jurisdictions around the globe, including the Netherlands, Cyprus, Australia, and Canada, following a series of 

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