Judge refused to let Binance founder Zhao travel to UAE despite his offer to use equity as security

Zhao Changpeng, founder and chief executive officer of Binance, attends the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France June 16, 2022. 
Benoit Tessier | Reuters

A federal judge last month rejected a request by Binance founder Changpeng “CZ” Zhao to travel to his home in the United Arab Emirates for the “hospitalization and surgery” of a person in his life even though he offered to post his Binance equity as security for his return to the U.S., a new court filing reveals.

The equity was worth $4.5 billion, based on Binance’s last round of fundraising two years ago, Zhao’s lawyers noted in their Dec. 22 letter to Judge Richard Jones, according to a filing Wednesday.

Zhao pleaded guilty in November in Seattle federal court to failing to maintain an effective anti-money laundering program at the company, the world’s largest cryptocurrency exchange. Binance agreed to pay $4.3 billion in penalties in the case.

Zhao, who stepped down as CEO because of his plea, is due to be sentenced on Feb. 23, but he has remained free in the U.S. on a $175 million release bond.

In the letter last month, his lawyers asked Judge Jones to allow him to travel to Abu Dhabi on Jan. 4 for a period of one to four weeks, so he could be present for the hospitalization, surgery, and subsequent recovery period of a person whose name is redacted in the copy of the letter filed Wednesday.

Details of the medical procedure were also blacked out in the letter, which noted that federal prosecutors had not consented to Zhao’s request.

Jones held a closed hearing on the request on Dec. 29, and denied Zhao’s bid to travel, court records show.

Jones earlier in December rejected another request to allow Zhao to travel to the UAE. The judge said Zhao’s “enormous wealth” made him a significant flight risk.

“The defendant has enormous wealth and property abroad, and no ties to the United States. His family resides in the UAE and it appears that he has favored status in the UAE,” Jones wrote in a six-page order on Dec. 7. “Under these circumstances the Court finds that the defendant has not established by clear and convincing evidence that he is not likely to flee if he returns to the UAE.”

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