The Bank of Zambia has proposed a new series of guidelines that seek to outlaw the use of foreign currency, including the U.S. dollar, for local transactions. If finally approved, the document would establish harsh penalties for infringement, including jail time for up to ten years and hefty fines. Zambia to Punish Illegal Use of […]
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Report Shows No Evidence of Special Treatment for BTC Ponzi Scheme Mastermind in Brazilian Jail
The Brazilian State Attorney General has dismissed allegations that Johann Steynberg, the late mastermind of a South African bitcoin ponzi scheme, was granted irregular access to a computer and the internet while in prison. Acting public prosecutor Lauro Machado Nogueira recently released a report stating that evidence from prison authorities contradicted these claims. Additionally, Steynberg, […]
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BREAKING: Former Binance CEO CZ Behind Bars: Sentenced To Jail For 4 Months
In a significant development for the crypto industry, Changpeng Zhao, commonly known as CZ, the founder of Binance, the world’s largest cryptocurrency exchange, has been imprisoned for four months.
The sentencing follows his guilty plea to charges related to enabling money laundering activities within his crypto exchange. The verdict was delivered in Seattle federal court and marks the culmination of US authorities’ multiyear investigation into Binance.
Lighter Sentence For Binance Founder
The sentence handed down to Zhao was notably less severe than the three-year prison term sought by federal prosecutors. In contrast, the defense had requested five months of probation, ultimately given the outcome wanted.
Under the terms of a settlement reached in November of 2023, Zhao agreed to step down as CEO of Binance, as part of an agreement to resolve the investigation.
The probe primarily focused on allegations that Binance failed to implement an effective anti-money laundering program, as the Bank Secrecy Act required.
Regulatory Pressure Mounts
Zhao was also accused of knowingly allowing Binance to process transactions involving funds derived from unlawful activities, including transactions between US citizens and individuals residing in sanctioned jurisdictions.
As part of the resolution, Binance was ordered to pay an imposing .3 billion fines and forfeiture. Additionally, Changpeng Zhao personally agreed to pay a substantial million fine, underscoring the severity of the charges and the commitment to accountability.
The legal challenges for Binance do not end there. The company faces separate lawsuits from the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) for alleged mishandling of customer assets and operating an illegal, unregistered exchange within the United States.
As of this writing, the exchange’s native token, Binance Coin (BNB), is trading at 3, down over 3% in the last 24 hours and 7% in the last seven days.
Featured image from Bloomberg, chart from TradingView.com
Former Binance Boss Changpeng Zhao Sentenced to 4 Months in Jail
On Tuesday, April 30, 2024, Changpeng Zhao (CZ), formerly the CEO of Binance, was sentenced in a Seattle courtroom for his compliance failures at the cryptocurrency exchange. The sentencing was first covered by Nikhilesh De and Danny Nelson of Coindesk, who reported directly from the courthouse. Per Nikhilesh De’s X thread, the proceedings began with […]
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Nigerian Instagram Celebrity Could Face Jail Time for ‘Spraying’ National Currency
Nigerian Instagram celebrity, Pascal Okechukwu, has pleaded not guilty to three counts of abusing naira banknotes. The charges against Okechukwu relate to three incidents in which he allegedly tampered with or “sprayed” NGN500 banknotes. Another Nigerian celebrity, Oluwadarasimi Omoseyin, received a six-month prison sentence for the same offence. Nigerian Authorities Clamp Down on Naira ‘Spraying’ […]
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Do Kwon Out of Jail, Under House Arrest Pending Extradition Decision
Multiple sources have reported that Do Kwon, the ex-chief executive officer of Terraform Labs, was set free from jail on Saturday while the high court in Montenegro decides on two separate extradition requests submitted by South Korea and the United States. Terraform Labs’ Former CEO Do Kwon Freed According to various sources, Do Kwon has […]
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Martin Shkreli Tells CZ ‘Jail Ain’t so Bad,’ Speculates About Sentence
Martin Shkreli, also known as ‘Pharma Bro,’ directed his attention to former Binance CEO Changpeng “CZ” Zhao’s situation, with CZ having recently pleaded guilty to money laundering charges as part of a .3 billion settlement. “Jail ain’t so bad,” Shkreli stressed, speculating that CZ could spend up to 1 year in jail or get probation.
Martin Shkreli to CZ: ‘Jail Ain’t so Bad’
Martin Shkreli, also known as ‘Pharma Bro’ due to his links to pharmaceutical companies, has referred to the situation of former Binance CEO Changpeng “CZ” Zhao and the odds he has of serving time in jail. Shkreli, who was sentenced to serve seven years in jail on securities fraud and conspiracy charges, told CZ that “jail ain’t so bad” and speculated about how much time (if any) he could serve according to his plea deal.
Zhao pleaded guilty to felony charges related to the Bank Secrecy Act (BSA), with the Department of Justice (DOJ) stating that he had “violated federal law that requires financial institutions to guard against money laundering and terrorist financing.”
According to the NYT, Zhao faces up to 18 months in prison under federal sentencing guidelines, but prosecutors are keeping open the possibility of asking for a stiffer penalty. If his sentence is lower than 18 months, Zhao’s deal includes waving his right to appeal.
Shkreli explained:
If this (BSA) is the charge he may get probation to 1 year, would be a decent deal for CZ to not get hit with title 18, ch 1956. He good on any pound in this case. Camp status, no violence. Might get to work on his push-up game.
Section 1956 of Title 18 of the U.S. Code establishes sentences of up to 20 years in jail and fines for anyone who “conducts or attempts to conduct a financial transaction involving property represented to be the proceeds of specified unlawful activity, or property used to conduct or facilitate specified unlawful activity.”
DOJ Flexes Its Power
Shkreli also discussed the real motivations behind the DOJ’s power move, stating that this action had to do with showing “the ability for the U.S. Government to shake you down whenever they feel like it.”
He stressed:
Remember, anon & friends, the criminal division of the DOJ can do whatever it wants to you, too. This isn’t about ‘the law’ or protecting people. It’s demonstrating the awesome power of government to put you in a cage.
This is not the first time Shkreli has discussed jail with a cryptocurrency personality. Shkreli told the same thing to former Terraform Labs founder Do Kwon, having also recently revealed details about former FTX CEO Sam Bankman-Fried’s experiences in jail.
What do you think about Shkreli’s thoughts on CZ’s sentence? Tell us in the comments section below.
Court Rules Sam Bankman-Fried Will Remain In Jail Through Trial, Here’s Why
During a court hearing held on Thursday, September 28, 2023, the Court ruled that the former CEO of now-bankrupt crypto exchange FTX Sam Bankman-Fried aka SBF will remain in jail throughout his trial.
Sam Bankman-Fried To Remain In Jail Throughout His Trial
At the brief court hearing on Thursday at the Manhattan federal court, Bankman-Fried’s lawyers requested that the court should temporarily release their client so he could be able to prepare his defense against the charges raised against him. However, the judge overseeing the case Judge Lewis A. Kaplan has denied the request as he believes the Defendant is a flight risk.
“The closer we get to trial, the more I’m wondering about that. Your client in the event of conviction could be looking at a very long sentence. If things begin to look bleak … maybe the time would come when he would seek to flee.” Judge Kaplan stated in the court hearing in Manhattan federal court.
Bankman-Fried’s lead lawyer Mark Cohen then argued that there was no reason for his client to try and flee. Cohen told Judge Kaplan that his request was made due to him being unable to meaningfully confer with his client Bankman-Fried as long as he is jailed at the Metropolitan Detention Center in Brooklyn.
In response, Assistant US Attorney Danielle Kudla told Judge Kaplan that Sam Bankman-Fried already had enough time to prepare for his trial. Kudla pointed out that Bankman-Fried had more than seven months to review his evidence and better prepare for his trial from the comfort of his parent’s home in Palo Alto, California since his freedom was not revoked until July 2023.
Sam Bankman-Fried was extradited to the United States from the Bahamas in December last year and he was placed on house arrest in his parent’s home in Palo Alto, California where he had limited access to electronic devices until he was jailed on August 11, 2023, by Judge Kaplan.
Sam Bankman-Fried was denied a 0 million bond by Judge Kaplan after the judge discovered that Bankman-Fried tried to tamper with and influence potential witnesses testifying against him.
However, Judge Lewis A. Kaplan pondered on what Cohen had said and he stated that the court would arrange for Cohen and other lawyers to meet with Bankman-Fried most of the trial days at 7:00 AM at the court to speak with Bankman-Fried hours before the testimony begins.
Bankman-Fried’s trial is set to begin on Tuesday, October 3, 2023, and it is expected to last more than 6 weeks. His lawyers already lost two other bail appeals before now. This marks the third time that the Defendant’s request to be released during his trial will be rejected by the court.
Prosecutors Bring Several Allegations Against FTX Founder
CEO Sam Bankman-Fried has pleaded not guilty to several allegations brought against him following the collapse of crypto exchange FTX back in November 2022.
Prosecutors accused Bankman-Fried of allegedly deceiving customers and investors to enrich himself and other executives while playing a major role in FTX’s multibillion-dollar collapse in November last year.
It was believed that Bankman-Fried stole billions of dollars in FTX customer deposits to resolve Alameda Research debts – a crypto hedge fund governed by him, live lavishly in the Caribbean, and fund political campaigns.
Former Chief Executive Officer of Bankman-Fried’s Alameda Research hedge fund Caroline Ellison already pleaded guilty to fraud. She is expected to testify against Bankman-Fried in the upcoming trial.
Latam Insights: Bitcoin Farm Found at Venezuelan Jail, Bill Protecting Crypto From Seizure Advances in Brazil
Welcome to Latam Insights, a compendium of Latin America’s most relevant crypto and economic news during the last week. In this issue: a Bitcoin mining farm is discovered during a raid on a Venezuelan jail, a bill that protects crypto from seizure advances in Brazil, and the Chilean police find a Bitcoin farm during a drug raid.
Bitcoin Farm Found in Venezuelan Jail
A Bitcoin mining farm was dismantled during a mega raid on the Venezuelan penitentiary center of Tocoron, located in the Aragua state. The raid, which involved the participation of more than 11,000 officers, found an undisclosed number of Bitcoin miners inside a makeshift mining farm, which was allegedly operated by the gang that held control of the national jail, called “Aragua’s Train.”
During the raid, the police also found drugs, rifles and ammo, C4 explosives, and more eccentric elements, like a disco where events were held, a swimming pool, a baseball stadium, and even a zoo.
Authorities have not issued statements on how long the mining farm operated inside the jail or if they had seized the funds that were obtained by the operation of this farm. Nonetheless, after the raid, the Tocoron Penitentiary will be closed, with more than 1,600 inmates being transferred to other jails in Venezuela.
Bill Protecting Crypto From Seizure Advances in Brazil
A bill that protects digital assets from creditor seizures is advancing in the deputy chamber of the Brazilian Congress. The bill, which also forbids the confiscation of salaries, pensions, and money in savings accounts in amounts of up to 40 minimum wages, was modified by Deputy Fernando Marangoni, who called to include cryptocurrency as part of its scope.
However, the final modification included the term “digital assets” instead of “cryptocurrency,” and will have to be reviewed by the Constitution, Justice, and Citizenship Commission of the Deputy Chamber.
Chilean Police Find Bitcoin Farm During Drug Operation
The Chilean Intelligence Police found a Bitcoin mining operation during a drug raid in southern Santiago. During Operation “Lucerna,” the police found 36 kilograms of cannabis, ecstasy, and ketamine pills. But they also stumbled upon a room with 19 Bitcoin miners, of which only 10 were active.
Eduardo Gatica, head of the Anti-Narcotics Brigade, stated this operation was directed to terminate a series of violent crimes linked to a drug trafficking ring. He stated:
It is the first time that drug trafficking has been so directly linked to cryptocurrency virtual data mining. It had not happened before in the country.
Gatica stated that cryptocurrency mining allowed these groups to launder assets, turning dirty money into clean money ready to be introduced in the market.
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What do you think about this week’s Latam Insights report? Tell us in the comment section below.
Venezuelan Authorities Find Grenade Launchers, Bitcoin Miners, and Even a Zoo in a National Jail
Venezuelan authorities found weapons of war, a discotheque, pools, a zoo, and even a makeshift Bitcoin mining farm in a raid completed on a national jail. The raid, executed in the Tocoron National Penitentiary Center, located in the Aragua state, mobilized 11,000 military officers to take control of the center.
Bitcoin Miners, Grenades, and Weapons Found in Venezuelan Jail Raid
Venezuelan authorities found Bitcoin miners among a series of irregular items during a raid executed on a national jail on September 21. 11,000 military and police officers participated in this action to liberate the Tocoron National Penitentiary in the Aragua state from the control of Aragua’s Train, the gang that managed the complex.
In a video detailing the aftermath of the raid, where an officer died in the line of duty, an undisclosed number of Bitcoin miners can be seen in a room that served as a mining farm. During the raid, the authorities found weapons of war, including rocket launchers, grenades, rifles, ammunition, and even C4 mines.
Other eccentricities were found inside the complex, including swimming pools, a discotheque where inmates held lavish parties, a baseball stadium, and even a makeshift zoo. Rosibel Gonzalez, a journalist in Venezuela, added that bikes, ice cream stalls, restaurants, and a children’s park were also found inside the complex.
Authorities reported that more than 1,600 inmates will be transferred to other national centers and that Tocoron will be closed.
Registered Venezuelan Bitcoin Miners Still in the Dark
While inmates had a micro mining farm in the penitentiary center, registered and legal Bitcoin miners are still being kept in the dark since Sunacrip, the Venezuelan cryptocurrency watchdog, was interrupted by a national government intervention more than six months ago.
Juan Blanco Bracamonte, a former Bitcoin miner who abandoned his activity due to the Sunacrip intervention, questioned the existence of these farms in a national jail. He stated:
Several questions arise for me as a digital miner who carried out this economic activity until this year. Who authorized the placement of that farm? Who managed the farm? What wallet did those funds go to? Who authorized the electrical availability? Did they pay for electricity consumption?
The former head of Sunacrip, Joselit Ramirez, was arrested for alleged involvement in a + billion corruption scheme involving the sale of oil for cryptocurrencies to sidestep economic sanctions. Since then, registered cryptocurrency farms have been disconnected from the grid by the state power company, Corpoelec.
In an interview with Criptonoticias, Alejandro Blanco, counsel for Asonacrip, a national cryptocurrency association, explained that Sunacrip puts miners who “invested their savings, time, and knowledge in complying with the current legal system” in jeopardy with these measures.
What do you think about the raid of the Venezuelan Tocoron jail? Tell us in the comment section below.