The deal, which will include charges against individuals and resolve allegations the company violated illicit finance and money-laundering laws, involves multiple US agencies: the Justice Department, the Commodity Futures Trading Commission (CFTC) and the Treasury Department’s Financial Crimes Enforcement Network, the source said.
The company’s chief executive Changpeng Zhao will step down as part of the settlement and plead guilty to violating criminal US anti-money laundering requirements, the Wall Street Journal reported on Tuesday. He will appear in Seattle federal court Tuesday afternoon to enter his plea, the newspaper said.
Reuters could not immediately verify the report.
The resolution would involve Binance paying a large penalty, though the source did not specify the exact amount. On Monday, Bloomberg reported that the Justice Department was seeking $4 billion from the crypto exchange.
Lawyers for Zhao and Binance, as well as a company spokesperson, did not immediately respond to calls for comment.
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A spokesperson for the DOJ declined to comment. The CFTC and Treasury Department did not respond to requests for comment. Binance has been under the Justice Department’s scrutiny since at least 2018, Reuters reported last year, just one of a string of legal and regulatory headaches it faces in the United States.
Federal prosecutors at the agency asked the company in December 2020 to provide internal records about its anti-money laundering efforts, along with communications involving CEO and founder Zhao.
The CFTC in March filed civil charges against Binance, alleging it failed to implement an effective anti-money laundering program required of financial institutions “to detect and prevent terrorist financing or other criminal activity.”
At the time, Zhao said the CFTC’s “complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged.”
