From Reuters, January 28:
- France opens judicial probe into Binance
- Charges include money laundering, tax fraud
- Binance denies allegations, says will fight charges
French investigators said on Tuesday they had opened a judicial probe into money laundering, tax fraud and other charges at Binance, the world's largest cryptocurrency exchange, which said it denied the allegations.
The economic and financial crime section of the Paris public prosecutor's office (JUNALCO) said in a statement that the probe includes money laundering in connection with drug trafficking.The investigation is examining the period from 2019 to 2024, involving offences committed in France but also in all European Union countries, JUNALCO said."Binance fully denies the allegations and will vigorously fight any charges made against it," a spokesperson for Binance said in an emailed statement, saying that the matter was "several years old".Binance's founder and former CEO Changpeng Zhao was last year sentenced to four months in prison, after pleading guilty to violating U.S. laws against money laundering. Binance agreed to pay a $4.3 billion penalty.Following a years-long probe, U.S. prosecutors said Binance had employed a "Wild West" model that welcomed criminals, and did not report more than 100,000 suspicious transactions with designated terrorist groups....
YZi will manage assets of Zhao and Binance co-founder Yi He
Zhao was released from correctional facility in late SeptemberChangpeng “CZ” Zhao, a few months out of prison and worth $70 billion thanks to the relentless crypto rally, is turning the former venture capital arm of his Binance Holdings Ltd. into a family office.
Binance Labs, which oversees about $10 billion of crypto-related assets, will be renamed YZi Labs, according to a statement on Thursday. Zhao brought back Ella Zhang, who helped set up Binance Labs in 2018 and left two years later, to run the outfit. YZi Labs will also manage the wealth of Binance co-founder Yi He, with whom Zhao has three children.
Zhao, 47, built Binance into the dominant crypto exchange while maintaining that it didn’t have a global headquarters. His approach to compliance didn’t sit well with US authorities, who in 2023 charged Binance and Zhao with failing to prevent cybercriminals and terrorists from trading on the platform. Zhao agreed to pay a $50 million fine, stepped down as CEO and was sentenced to four months in custody. He was released in September.
YZi Labs, a play on the Binance co-founders’ names, is now “purely a family office investment vehicle,” Zhang said in an interview.
After publication of this story, YZi Labs issued a statement to Bloomberg News saying it is not a family office, but rather “a venture capital and incubator firm dedicated to fostering innovation and supporting investments across various sectors.” It also said He isn’t involved in YZi Labs’s day-to-day operations.
The firm doesn’t have a formal headquarters as its staff operate remotely, a spokesperson said.
There’s no immediate need for Zhao to inject more money into YZi Labs, Zhang said. His $69.8 billion fortune is ranked 22nd in the world by the Bloomberg Billionaires Index, which estimates it to consist entirely of his stake in Binance Holdings.
A billionaire turning his business into a family office after a brush with authorities isn’t entirely without precedent.
SAC Capital Advisors, founded by legendary investor Steve Cohen, pleaded guilty in 2013 to reaping hundreds of millions of dollars in illegal profits and allowing a culture of criminality that rewarded brazen insider trading. Cohen — who consistently denied wrongdoing — was never charged or sued, though he agreed not to manage outside money for two years, and turned his firm into a family office.
After his release from a low-security California prison, Zhao pledged in a post on X to focus on investments that would prioritize “impact” over returns. He also said a new endeavor named Giggle Academy, a nonprofit online education platform, would be a big part of his life. By then, Binance had begun the process of severing ties with the venture capital unit.....
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