CFTC announces more enforcement actions against crypto exchanges

What’s new? The US Commodity Futures Trading Commission (CFTC) has said it will continue to aggressively pursue crypto exchanges that violate trade laws. Officials made this statement following a settlement of claims against Binance, under which the exchange will pay a $4,3 billion fine for violating anti-money laundering regulations. Binance founder Changpeng Zhao, under the agreement, left the post of CEO and paid $50 million, part of this amount is a fine by the CFTC for allowing US clients to trade unregistered crypto derivatives.

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What else is known? CFTC Commissioner Christy Goldsmith Romero said that the agency will continue to remove unscrupulous players from the local market and will not allow the use of VPNs or other mechanisms to bypass user identification procedures (KYC). She emphasized, however, that access to US customers for crypto companies “is a privilege, not a right.”

Her colleague Caroline Pham also stated that the commission’s reach has no boundaries, “It should be crystal clear that the CFTC will not stop in its pursuit of non-US entities.”

The CFTC filed a lawsuit against Binance in March of this year. The regulator’s main claim was that the company served US clients on its global platform, while they should have been allowed access only to the local arm, Binance.US. At the time, Zhao called the lawsuit “unexpected and disappointing” because its filing was preceded by two years of cooperation with the regulator.

In July, the exchange tried to dismiss the lawsuit, arguing that the global exchange’s actions did not fall under the CFTC’s jurisdiction.

As part of the new agreement, Binance, in addition to the commission, will pay fines to the DOJ’s sanctions enforcement (OFAC) фтв anti-money laundering (FinCEN) divisions and completely cease operations in the States. Local officials will monitor its operations for the next five years.

DOJ requests Changpeng Zhao be barred from leaving the US pending sentencing

Binance founder could face up to 18 months in prison

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Zhao, who pleaded guilty to violating AML regulations, will be sentenced separately, with a hearing set for February 23 next year. He could face up to 18 months in prison, prompting the Ministry of Justice to ask the court to ban the businessman from leaving the country.