Binance CZ Denied Return to UAE Till Further Notice

Former Binance CEO Changpeng Zhao had looked all set to return to the UAE after his plea hearing but will now have to wait for a decision on the matter.

Binance founder Changpeng Zhao (CZ) will have his stay in the United States extended after District Judge Richard Jones made a decision that had earlier permitted CZ’s return to the United Arab Emirates (UAE), where his wife and children reside. 

The latest development follows fresh allegations by the United States Department of Justice (DOJ) that CZ presented significant “flight risk.” The legal authority argued that CZ will not willingly return to the U.S. for his scheduled sentencing hearing in February 2024.

Binance’s founder is stuck in the United States for now

Recall that in the past week, Changpeng Zhao (CZ) pleaded guilty to deliberately violating the U.S. Bank Secrecy Act. A magistrate judge, Brian Tsuchida, allowed CZ’s release after he consented to personal and guarantor-based bonds totaling $195 million. He also agreed to pay a $50 million fine.

At the time, the judge ruled that CZ had shown good faith by voluntarily coming to the U.S. for his plea hearing, even though he was not obligated to do so. The size of the Binance settlement package ($4.3 billion) was also considered evidence that the founder was willing to resolve the case.

As part of the deal, the judge approved that CZ could travel back to the UAE to reunite with his family, pending his return to the U.S. in February for sentencing. However, the fact that the bond deal was open to debate until Monday opened the opportunity for the U.S. DOJ to appeal the move.

Attorneys representing the agency claimed that CZ would not honor the deal. The primary argument is that most of C.Z.’s wealth is outside the U.S., while he resides in the UAE, which does not have an extradition treaty with the United States.

Hence, if the Binance CEO refuses to return to America in February, U.S. authorities cannot force the U.A.E to transfer him. Meanwhile, the DoJ argues that the possibility of a ten-year sentence is enough reason for CZ to refuse to return to the United States in February. Notably, the prison sentence may also fall within a few months, with CZ’s attorneys having the right to appeal a longer sentence.

In staying the motion, District Judge Richard Jones noted that the court will now review an earlier decision by Magistrate Judge Brian Tsuchida in view of “briefing, files and pleadings” provided by DOJ and CZ’s attorneys. The case would remain pending until the court considers the Government’s complaints, meaning that CZ would stay in the United States until further notice.