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U.S. Justice Department is split over charging Binance as crypto world falters

91 points by VagueMag 4y ago

totalZero 4y ago
> The investigation began in 2018 and is focused on Binance's compliance with U.S. anti-money laundering laws and sanctions, these people said If the investigation is five years old, then this isn't as big of a story as it seems on first glance. Not yet, at least.
- ceejayoz 4y ago
  It took three years to charge Enron's CEO. Complex financial crimes frequently take years to prosecute. "DOJ officials have discussed possible plea deals with Binance's attorneys" is new info, to my knowledge.
- rippercushions 4y ago
  The investigation is about whether Binance has broken AML laws. There are a million other laws they may have broken, but like FTX, we're unlikely to find out until it implodes.
- arcticbull 4y ago
  Disagree, these kinds of things take years to make their way through the system. If it really has been ongoing for 5 years, that would be roughly around the time I would expect them to move forward with charges, if they were going to. [edit] If I were CZ a 5 year long investigation would make me far more worried, not less. The authorities don't investigate nothing for 5 years, after all. If this was a witch hunt it sounds like they found a coven.
- DannyBee 4y ago
  ? Especially with dealing with a bunch of weird international jurisdictions to gather evidence, 5 years is not a long time. Because it often has to wind it's way through cooperation agreements, other legal systems, etc.
jMyles 4y ago
Whatever else does or doesn't amount to justice in this world, it's simply untenable to have a system of 'laws' which are so complex that highly educated and specialized attorneys require five years of research and deliberation to determine if they've been broken.
- ceejayoz 4y ago
  That's not what takes five years. The laws aren't that complex here; gathering the evidence is. Prosecutors want enough evidence in hand to guarantee a conviction, because they only get one go under double jeopardy... and Binance is overseas. https://www.coindesk.com/markets/2020/05/08/binance-doesnt-have-a-headquarters-because-bitcoin-doesnt-says-ceo/ https://www.coindesk.com/markets/2020/05/08/binance-doesnt-h... > This seemingly simple question is actually more complex. Until February, Binance was considered to be based in Malta. That changed when the island European nation announced that, no, Binance is not under its jurisdiction. Since then Binance has not said just where, exactly, it is now headquartered.
  - rtkwe 4y ago
    The complex part of the law is the intent requirement that's pretty endemic to most "white collar" crimes. That feature in the law makes gathering evidence long and arduous because it requires establishing what's happening inside the minds of executives who know that writing down and emailing certain things is very bad and proves intent, so they have to nibble around the edges of the case picking off people and turning them to share private conversations or out of band communications that go towards showing intent.
323 4y ago
Another famous bitcoin exchange, BitMEX, was also investigated for AML/KYC violations and the owners were arrested. One (Arthur) got 6 months of house arrest. There were no other allegations (no financial fraud). > Among Binance's arguments: A criminal prosecution would wreak havoc on a crypto market already in a prolonged downturn. The famous "Too Big To Jail" argument. Worked for US banks. Even the US General Attorney agreed with this view: > Attorney General Eric Holder, the top U.S. law-enforcement official, finally admitted this week that bank executives truly are above the law and may commit crimes with virtual impunity. > Appearing before the Senate Judiciary Committee, Holder acknowledged under questioning by Republican Chuck Grassley of Iowa, the ranking member, that the megabanks are too big to jail. “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them,” https://www.marketwatch.com/story/holder-admits-mega-banks-are-too-big-to-jail-2013-03-07 https://www.marketwatch.com/story/holder-admits-mega-banks-a...
- simple-thoughts 4y ago
  These are generally (although not always) victimless crimes. I don’t know the specifics of that case or the severity of it.
  - 323 4y ago
    There could be second order victims. Bank accepts drug money breaking AML and you say it is "victimless crime", but a lot of people are dead because of drug usage or drug wars. In our case, crypto exchanges not doing AML can facilitate crypto hacking or ransomware.
    - simple-thoughts 4y ago
      Every grocery store creates second order victims by feeding criminals.
    - lazide 4y ago
      The beauty of that argument of course is that no causal links need to be proven, and no agency or ownership of their actions needs to occur for the ‘victims’? That’s like saying the copper miners are somehow responsible for war deaths because copper is an essential component of ammunition, and if they just figured that out and didn’t sell or allow their products to be sold to ammunition manufacturers, we’d have world peace.
neilv 4y ago
> Splits between U.S. Department of Justice prosecutors are delaying the conclusion of a long-running criminal investigation into the world's largest cryptocurrency exchange Binance, four people familiar with the matter have told Reuters. Who is leaking information about a federal criminal investigation, and why?
- JumpCrisscross 4y ago
  > Who is leaking information about a federal criminal investigations, and why? People pissed at folks they suspect are stalling prosecution, is my guess.
- 323 4y ago
  They are talking with Binance lawyers about settling the investigation. The only leak here is towards the public. And the US govt is leaking more than a sieve. Remember the ultra top secret CIA black sites? That was leaked.
cactusplant7374 4y ago
It would be much easier to indict Brian Armstrong first. He’s in the US and his exchange listed securities without disclosures.
- JumpCrisscross 4y ago
  > his exchange listed securities without disclosures This per se isn’t a criminal offence. The SEC is still deliberating whether it’s a civil offence.
  - rafale 4y ago
    The SEC is gonna give them a small fine at best. They are not gonna do something that's gonna disadvantage the big US players.
justapassenger 4y ago
Anyone who thinks it’s a proof of some conspiracy, doesn’t understand how law works. You cannot charge someone twice with the same crime. If you don’t have strong enough case, DOJ will lose, and that’s done. They cannot bring the case later saying “ok, now we have all the evidence, let’s try again!”. Of course, this also doesn’t rule out there’s no conspiracy.
- ceejayoz 4y ago
  Precisely. This is not a "crime vs no-crime" split. It's a "prosecute now vs prosecute later" split. > Some of the at least half dozen federal prosecutors involved in the case believe the evidence already gathered justifies moving aggressively against the exchange and filing criminal charges against individual executives including founder Changpeng Zhao, said two of the sources. Others have argued taking time to review more evidence, the sources said.
  - rafale 4y ago
    I wonder what the status of limitation is in this case. The clock will run out eventually so they are definitely under pressure to build the case.
    - ceejayoz 4y ago
      That assumes they've stopped committing the crimes in question.
    - lazide 4y ago
      Depends on the jurisdiction and the crime. Federally, seems like 5 years from when the crime was committed, unless it was a serious crime [https://sgp.fas.org/crs/misc/RL31253.pdf https://sgp.fas.org/crs/misc/RL31253.pdf]. Other places (California) often base it on when the crime was discovered/known about. So if someone buried some cash or something, then ignored it, and someone stole it in the meantime, the statute of limitations on prosecuting the theft would be when they went back and discovered it gone, not when it was taken. I’m sure they are taking it into account.
Kukumber 4y ago
habosa 4y ago
Surprised this isn’t a slam dunk. One of the main reasons Binance is popular is because in the 2017 crypto run up they made it easier than anyone else to get an account and start trading. It seemed obvious at the time they couldn’t be compliant with AML/KYC laws and they were using lax policy there to outrun the competition.
acdha 4y ago
Ken White, a former federal prosecutor, had a good thread about why these things take so long in the context of the FTX fraud – specifically how most “white collar” crimes require you to prove someone intended to commit a crime: https://threadreaderapp.com/thread/1600877380683280384.html https://threadreaderapp.com/thread/1600877380683280384.html This case is going to be even harder because a lot of the evidence and people are not in the United States so everything he describes there is going to be even harder because it will require international law enforcement cooperation — even if China wants to lock down cryptocurrency that doesn't mean they're just doing whatever the U.S. DOJ asks for without careful negotiation — and simple things like language and cultural barriers mean that, for example, they need to find a forensic account who is fluent in the language, terminology, and practices in multiple other countries. It also makes it hard to do the common practice where they catch someone low-level and get them to testify against their boss in exchange for leniency since a lot of those people are not going to be easily accessible to U.S. law enforcement.
65 4y ago
Even if all the exchanges go down, I would be surprised if BTC completely crashed. It's still highly useful for buying illegal drugs, and for money laundering. If you notice, whenever there are crypto crashes, the BTC value after everything stabilizes is usually higher than it was before the mania. I would guess this has to do with BTC being increasingly useful for illegal activities.
- willnonya 4y ago
  This is the big failing of BTC. It's nearly useless as a daily currency and precieved as something only criminals use.
- rvz 4y ago
  > It's still highly useful for buying illegal drugs, and for money laundering. Yeah, 'highly useful' enough for the authorities and for everyone to see all the transactions on a public ledger to track down who paid for what and to identify anyone who attempts to convert the BTC to fiat as soon as it hits the exchange. Totally useful for criminals and hackers. /s Especially when they are getting caught all the time by the authorities when they use Bitcoin.
  - lazide 4y ago
    That is one of the weirdest blind spots here. It has an immutable transaction log showing everything that ever happened. It’s a fundamental part of the currency/protocol. That means if your wallet gets seized or compromised, someone can see every transaction you ever did, every counterparty, and every transaction each of those counter parties every did. That’s a big yikes if you’re in a criminal enterprise! There are ways now to make it less obvious/transparent who is who, but it still exposes a massive treasure trove of info to law enforcement once they start looking, that just doesn’t exist with cash unless someone goes through a ton of effort to create it. Hell, if I was some 3 letter agency, I’d want as many criminals as possible to use Bitcoin!
    - acdha 4y ago
      I've also found it weird how often the response has been something along the lines of “you should use a mixer”, as if that technology is proven to be robust or apparent awareness that it's not a great idea to publicly give law enforcement evidence that you're trying to hide something, especially when your activity might attract scrutiny because you're providing cover to a high-priority crime. I would not want to be in court pleading for leniency on the grounds that you didn't know or intend that your transaction activity would help North Korea.
jmsflknr 4y ago
Same story, same link was submitted by me before this submission: https://news.ycombinator.com/item?id=33954008 https://news.ycombinator.com/item?id=33954008
TSiege 4y ago
The most shocking part of this story is the number of former US officials who are now working for Binance to try to protect them from prosecution. While this might be technically legal and part of what goes on in Washington, it's a sign of severe moral decay amongst our government and is a striking example of normalized corruption > [Zhao] instigated a recruitment spree last year that led to the hiring of officials from the Internal Revenue Service's Criminal Investigation division, the U.S. government agency that was investigating Binance > [...] A recruitment program by Binance among law enforcement officials in the United States, offering salaries that far exceeded what was available at many other finance and crypto firms, according to four people familiar with the outreach > Binance has hired a former chief of MLARS [Money Laundering and Asset Recovery Section], Kendall Day, a partner at Gibson Dunn, to engage in discussions with the Justice Department. > [Binance] hired at least five ex-officials from the IRS Criminal Investigation's Cyber Crime Unit, including a new global head of investigations called Tigran Gambaryan > Faced with the Justice Department investigation, Binance hired an external lawyer from U.S. law firm Paul Weiss, Roberto Gonzalez, who was previously Treasury's deputy general counsel.
- mattbrewsbytes 4y ago
  > The most shocking part of this story is the number of former US officials who are now working for Binance You realize this is how the SEC and various regulatory entities end up working? I wouldn't say its shocking. The people are commonly on one side (regulation) or the other (private sector) without any type of "layover" or time out in between. I think FTX was attempting to hire someone from the CFTC (regulatory body over crypto) as part of their team. I would love politicians to write up an Anti-Corruption Act with some sensible rules around these types of things to at least put some distance between jobs and counter balances around corruption/collusion. Penalties should be in the range of can't work in that industry anymore to federal prison time. The other idea I'd like to see traction on is implementing term limits in Congress. I don't have a lot of hope that either will happen in my lifetime.
  - acdha 4y ago
    One big challenge is that there’s so much political rancor around the “overpaid civil servant” trope. We’d be much better off if e.g. SEC lawyers were paid enough to be hotly-contested jobs with a 10 year sinecure plus a non-compete, but that would involve paying them enough that there’d be constant claims of inefficiency.
Kukumber 4y ago
It's interesting to witness the increase of FUD against Binance the past months Will be interesting to see what the outcome of all of this will be, if Binance collapses, it'll be the end of Crypto If Coinbase remains as the sole exchange, then we'll be able to conclude that it is indeed operated by the CIA/FED to promote a digital EURODOLLAR issued by the central bank It can't be otherwise since China is making moves with its e-YUAN [1,2] That's the natural outcome of this post-capitalist society in the making, you own nothing, you get your credits that resets every months, no interest rates, no savings [1] - https://www.chinadaily.com.cn/a/202212/06/WS638e7e0fa31057c47eba2c74.html https://www.chinadaily.com.cn/a/202212/06/WS638e7e0fa31057c4... [2] - https://www.japantimes.co.jp/opinion/2022/12/12/commentary/world-commentary/chinese-digital-yuan/ https://www.japantimes.co.jp/opinion/2022/12/12/commentary/w... What's warranting getting flagged?, care to explain what i'm doing wrong that's against the rules? Every arguments i provide are always sourced
- JumpCrisscross 4y ago
  > the increase of FUD against Binance the past months This is disingenuous framing. Was the run-up to FTX’s dissolution similarly FUD? Even if it was, not all fear is irrational. Not all caution unwarranted. Trusting a business that refuses to be audited, refuses to disclose its ownership or even where it’s physically or legally based, and has—wherever sunlight shines—been caught breaking the law carries obvious repurcussions. > the CIA/FED to promote a digital EURODOLLAR issued by the central bank Wat. Is this the new NAFTA currency conspiracy?
  - Kukumber 4y ago
    > Wat. Is this the new NAFTA currency conspiracy? That's not a conspiracy, central banks in both the US / EU are preparing for their digital fiat [1] It's the FED and CIA's job to prepare the country for the future with research, intelligence and planning, i don't understand why people are afraid to mention them, they did it with SWIFT [2], they did it with Google and the hyper-text [3] They anticipated and prepared for the digitization of the society and economy ahead of time decades ago already, there is no "conspiracy" > This is disingenuous framing. Was the run-up to FTX’s dissolution similarly FUD? I don't think that's disingenuous, when you look at the origins of FTX [4] (ties with US government), how it grew, and how it managed to approach Binance for a possible acquisition + the conjuncture and the climate of the market right before the acquisition are strange, specially after Binance's findings [5] [1] - https://www.atlanticcouncil.org/cbdctracker/ https://www.atlanticcouncil.org/cbdctracker/ [2] - https://qz.com/1145669/googles-true-origin-partly-lies-in-cia-and-nsa-research-grants-for-mass-surveillance https://qz.com/1145669/googles-true-origin-partly-lies-in-ci... [3] - https://qz.com/1145669/googles-true-origin-partly-lies-in-cia-and-nsa-research-grants-for-mass-surveillance https://qz.com/1145669/googles-true-origin-partly-lies-in-ci... [4] - https://twitter.com/mgnr_io/status/1598978315913940994 https://twitter.com/mgnr_io/status/1598978315913940994 [5] - https://www.binance.com/en/feed/post/51123 https://www.binance.com/en/feed/post/51123
MomoXenosaga 4y ago
Crypto shit taking up valuable time and resources from regulators. Don't know about the US but in my country the authorities were very clear that cryptocurrency was for pedos and idiots so let it all burn.

91 points by VagueMag 4y ago

> The investigation began in 2018 and is focused on Binance's compliance with U.S. anti-money laundering laws and sanctions, these people said If the investigation is five years old, then this isn't as big of a story as it seems on first glance. Not yet, at least.

ceejayoz 4y ago
It took three years to charge Enron's CEO. Complex financial crimes frequently take years to prosecute. "DOJ officials have discussed possible plea deals with Binance's attorneys" is new info, to my knowledge.
rippercushions 4y ago
The investigation is about whether Binance has broken AML laws. There are a million other laws they may have broken, but like FTX, we're unlikely to find out until it implodes.
arcticbull 4y ago
Disagree, these kinds of things take years to make their way through the system. If it really has been ongoing for 5 years, that would be roughly around the time I would expect them to move forward with charges, if they were going to. [edit] If I were CZ a 5 year long investigation would make me far more worried, not less. The authorities don't investigate nothing for 5 years, after all. If this was a witch hunt it sounds like they found a coven.
DannyBee 4y ago
? Especially with dealing with a bunch of weird international jurisdictions to gather evidence, 5 years is not a long time. Because it often has to wind it's way through cooperation agreements, other legal systems, etc.

jMyles 4y ago

Whatever else does or doesn't amount to justice in this world, it's simply untenable to have a system of 'laws' which are so complex that highly educated and specialized attorneys require five years of research and deliberation to determine if they've been broken.

ceejayoz 4y ago
That's not what takes five years. The laws aren't that complex here; gathering the evidence is. Prosecutors want enough evidence in hand to guarantee a conviction, because they only get one go under double jeopardy... and Binance is overseas. https://www.coindesk.com/markets/2020/05/08/binance-doesnt-have-a-headquarters-because-bitcoin-doesnt-says-ceo/ https://www.coindesk.com/markets/2020/05/08/binance-doesnt-h... > This seemingly simple question is actually more complex. Until February, Binance was considered to be based in Malta. That changed when the island European nation announced that, no, Binance is not under its jurisdiction. Since then Binance has not said just where, exactly, it is now headquartered.
- rtkwe 4y ago
  The complex part of the law is the intent requirement that's pretty endemic to most "white collar" crimes. That feature in the law makes gathering evidence long and arduous because it requires establishing what's happening inside the minds of executives who know that writing down and emailing certain things is very bad and proves intent, so they have to nibble around the edges of the case picking off people and turning them to share private conversations or out of band communications that go towards showing intent.

323 4y ago

Another famous bitcoin exchange, BitMEX, was also investigated for AML/KYC violations and the owners were arrested. One (Arthur) got 6 months of house arrest. There were no other allegations (no financial fraud). > Among Binance's arguments: A criminal prosecution would wreak havoc on a crypto market already in a prolonged downturn. The famous "Too Big To Jail" argument. Worked for US banks. Even the US General Attorney agreed with this view: > Attorney General Eric Holder, the top U.S. law-enforcement official, finally admitted this week that bank executives truly are above the law and may commit crimes with virtual impunity. > Appearing before the Senate Judiciary Committee, Holder acknowledged under questioning by Republican Chuck Grassley of Iowa, the ranking member, that the megabanks are too big to jail. “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them,” https://www.marketwatch.com/story/holder-admits-mega-banks-are-too-big-to-jail-2013-03-07 https://www.marketwatch.com/story/holder-admits-mega-banks-a...

simple-thoughts 4y ago
These are generally (although not always) victimless crimes. I don’t know the specifics of that case or the severity of it.
- 323 4y ago
  There could be second order victims. Bank accepts drug money breaking AML and you say it is "victimless crime", but a lot of people are dead because of drug usage or drug wars. In our case, crypto exchanges not doing AML can facilitate crypto hacking or ransomware.
  - simple-thoughts 4y ago
    Every grocery store creates second order victims by feeding criminals.
  - lazide 4y ago
    The beauty of that argument of course is that no causal links need to be proven, and no agency or ownership of their actions needs to occur for the ‘victims’? That’s like saying the copper miners are somehow responsible for war deaths because copper is an essential component of ammunition, and if they just figured that out and didn’t sell or allow their products to be sold to ammunition manufacturers, we’d have world peace.

neilv 4y ago

> Splits between U.S. Department of Justice prosecutors are delaying the conclusion of a long-running criminal investigation into the world's largest cryptocurrency exchange Binance, four people familiar with the matter have told Reuters. Who is leaking information about a federal criminal investigation, and why?

JumpCrisscross 4y ago
> Who is leaking information about a federal criminal investigations, and why? People pissed at folks they suspect are stalling prosecution, is my guess.
323 4y ago
They are talking with Binance lawyers about settling the investigation. The only leak here is towards the public. And the US govt is leaking more than a sieve. Remember the ultra top secret CIA black sites? That was leaked.

cactusplant7374 4y ago

It would be much easier to indict Brian Armstrong first. He’s in the US and his exchange listed securities without disclosures.

JumpCrisscross 4y ago
> his exchange listed securities without disclosures This per se isn’t a criminal offence. The SEC is still deliberating whether it’s a civil offence.
- rafale 4y ago
  The SEC is gonna give them a small fine at best. They are not gonna do something that's gonna disadvantage the big US players.

justapassenger 4y ago

Anyone who thinks it’s a proof of some conspiracy, doesn’t understand how law works. You cannot charge someone twice with the same crime. If you don’t have strong enough case, DOJ will lose, and that’s done. They cannot bring the case later saying “ok, now we have all the evidence, let’s try again!”. Of course, this also doesn’t rule out there’s no conspiracy.

ceejayoz 4y ago
Precisely. This is not a "crime vs no-crime" split. It's a "prosecute now vs prosecute later" split. > Some of the at least half dozen federal prosecutors involved in the case believe the evidence already gathered justifies moving aggressively against the exchange and filing criminal charges against individual executives including founder Changpeng Zhao, said two of the sources. Others have argued taking time to review more evidence, the sources said.
- rafale 4y ago
  I wonder what the status of limitation is in this case. The clock will run out eventually so they are definitely under pressure to build the case.
  - ceejayoz 4y ago
    That assumes they've stopped committing the crimes in question.
  - lazide 4y ago
    Depends on the jurisdiction and the crime. Federally, seems like 5 years from when the crime was committed, unless it was a serious crime [https://sgp.fas.org/crs/misc/RL31253.pdf https://sgp.fas.org/crs/misc/RL31253.pdf]. Other places (California) often base it on when the crime was discovered/known about. So if someone buried some cash or something, then ignored it, and someone stole it in the meantime, the statute of limitations on prosecuting the theft would be when they went back and discovered it gone, not when it was taken. I’m sure they are taking it into account.

Kukumber 4y ago

habosa 4y ago

Surprised this isn’t a slam dunk. One of the main reasons Binance is popular is because in the 2017 crypto run up they made it easier than anyone else to get an account and start trading. It seemed obvious at the time they couldn’t be compliant with AML/KYC laws and they were using lax policy there to outrun the competition.

acdha 4y ago

Ken White, a former federal prosecutor, had a good thread about why these things take so long in the context of the FTX fraud – specifically how most “white collar” crimes require you to prove someone intended to commit a crime: https://threadreaderapp.com/thread/1600877380683280384.html https://threadreaderapp.com/thread/1600877380683280384.html This case is going to be even harder because a lot of the evidence and people are not in the United States so everything he describes there is going to be even harder because it will require international law enforcement cooperation — even if China wants to lock down cryptocurrency that doesn't mean they're just doing whatever the U.S. DOJ asks for without careful negotiation — and simple things like language and cultural barriers mean that, for example, they need to find a forensic account who is fluent in the language, terminology, and practices in multiple other countries. It also makes it hard to do the common practice where they catch someone low-level and get them to testify against their boss in exchange for leniency since a lot of those people are not going to be easily accessible to U.S. law enforcement.

65 4y ago

Even if all the exchanges go down, I would be surprised if BTC completely crashed. It's still highly useful for buying illegal drugs, and for money laundering. If you notice, whenever there are crypto crashes, the BTC value after everything stabilizes is usually higher than it was before the mania. I would guess this has to do with BTC being increasingly useful for illegal activities.

willnonya 4y ago
This is the big failing of BTC. It's nearly useless as a daily currency and precieved as something only criminals use.
rvz 4y ago
> It's still highly useful for buying illegal drugs, and for money laundering. Yeah, 'highly useful' enough for the authorities and for everyone to see all the transactions on a public ledger to track down who paid for what and to identify anyone who attempts to convert the BTC to fiat as soon as it hits the exchange. Totally useful for criminals and hackers. /s Especially when they are getting caught all the time by the authorities when they use Bitcoin.
- lazide 4y ago
  That is one of the weirdest blind spots here. It has an immutable transaction log showing everything that ever happened. It’s a fundamental part of the currency/protocol. That means if your wallet gets seized or compromised, someone can see every transaction you ever did, every counterparty, and every transaction each of those counter parties every did. That’s a big yikes if you’re in a criminal enterprise! There are ways now to make it less obvious/transparent who is who, but it still exposes a massive treasure trove of info to law enforcement once they start looking, that just doesn’t exist with cash unless someone goes through a ton of effort to create it. Hell, if I was some 3 letter agency, I’d want as many criminals as possible to use Bitcoin!
  - acdha 4y ago
    I've also found it weird how often the response has been something along the lines of “you should use a mixer”, as if that technology is proven to be robust or apparent awareness that it's not a great idea to publicly give law enforcement evidence that you're trying to hide something, especially when your activity might attract scrutiny because you're providing cover to a high-priority crime. I would not want to be in court pleading for leniency on the grounds that you didn't know or intend that your transaction activity would help North Korea.

jmsflknr 4y ago

Same story, same link was submitted by me before this submission: https://news.ycombinator.com/item?id=33954008 https://news.ycombinator.com/item?id=33954008

TSiege 4y ago

The most shocking part of this story is the number of former US officials who are now working for Binance to try to protect them from prosecution. While this might be technically legal and part of what goes on in Washington, it's a sign of severe moral decay amongst our government and is a striking example of normalized corruption > [Zhao] instigated a recruitment spree last year that led to the hiring of officials from the Internal Revenue Service's Criminal Investigation division, the U.S. government agency that was investigating Binance > [...] A recruitment program by Binance among law enforcement officials in the United States, offering salaries that far exceeded what was available at many other finance and crypto firms, according to four people familiar with the outreach > Binance has hired a former chief of MLARS [Money Laundering and Asset Recovery Section], Kendall Day, a partner at Gibson Dunn, to engage in discussions with the Justice Department. > [Binance] hired at least five ex-officials from the IRS Criminal Investigation's Cyber Crime Unit, including a new global head of investigations called Tigran Gambaryan > Faced with the Justice Department investigation, Binance hired an external lawyer from U.S. law firm Paul Weiss, Roberto Gonzalez, who was previously Treasury's deputy general counsel.

mattbrewsbytes 4y ago
> The most shocking part of this story is the number of former US officials who are now working for Binance You realize this is how the SEC and various regulatory entities end up working? I wouldn't say its shocking. The people are commonly on one side (regulation) or the other (private sector) without any type of "layover" or time out in between. I think FTX was attempting to hire someone from the CFTC (regulatory body over crypto) as part of their team. I would love politicians to write up an Anti-Corruption Act with some sensible rules around these types of things to at least put some distance between jobs and counter balances around corruption/collusion. Penalties should be in the range of can't work in that industry anymore to federal prison time. The other idea I'd like to see traction on is implementing term limits in Congress. I don't have a lot of hope that either will happen in my lifetime.
- acdha 4y ago
  One big challenge is that there’s so much political rancor around the “overpaid civil servant” trope. We’d be much better off if e.g. SEC lawyers were paid enough to be hotly-contested jobs with a 10 year sinecure plus a non-compete, but that would involve paying them enough that there’d be constant claims of inefficiency.

Kukumber 4y ago

It's interesting to witness the increase of FUD against Binance the past months Will be interesting to see what the outcome of all of this will be, if Binance collapses, it'll be the end of Crypto If Coinbase remains as the sole exchange, then we'll be able to conclude that it is indeed operated by the CIA/FED to promote a digital EURODOLLAR issued by the central bank It can't be otherwise since China is making moves with its e-YUAN [1,2] That's the natural outcome of this post-capitalist society in the making, you own nothing, you get your credits that resets every months, no interest rates, no savings [1] - https://www.chinadaily.com.cn/a/202212/06/WS638e7e0fa31057c47eba2c74.html https://www.chinadaily.com.cn/a/202212/06/WS638e7e0fa31057c4... [2] - https://www.japantimes.co.jp/opinion/2022/12/12/commentary/world-commentary/chinese-digital-yuan/ https://www.japantimes.co.jp/opinion/2022/12/12/commentary/w... What's warranting getting flagged?, care to explain what i'm doing wrong that's against the rules? Every arguments i provide are always sourced

JumpCrisscross 4y ago
> the increase of FUD against Binance the past months This is disingenuous framing. Was the run-up to FTX’s dissolution similarly FUD? Even if it was, not all fear is irrational. Not all caution unwarranted. Trusting a business that refuses to be audited, refuses to disclose its ownership or even where it’s physically or legally based, and has—wherever sunlight shines—been caught breaking the law carries obvious repurcussions. > the CIA/FED to promote a digital EURODOLLAR issued by the central bank Wat. Is this the new NAFTA currency conspiracy?
- Kukumber 4y ago
  > Wat. Is this the new NAFTA currency conspiracy? That's not a conspiracy, central banks in both the US / EU are preparing for their digital fiat [1] It's the FED and CIA's job to prepare the country for the future with research, intelligence and planning, i don't understand why people are afraid to mention them, they did it with SWIFT [2], they did it with Google and the hyper-text [3] They anticipated and prepared for the digitization of the society and economy ahead of time decades ago already, there is no "conspiracy" > This is disingenuous framing. Was the run-up to FTX’s dissolution similarly FUD? I don't think that's disingenuous, when you look at the origins of FTX [4] (ties with US government), how it grew, and how it managed to approach Binance for a possible acquisition + the conjuncture and the climate of the market right before the acquisition are strange, specially after Binance's findings [5] [1] - https://www.atlanticcouncil.org/cbdctracker/ https://www.atlanticcouncil.org/cbdctracker/ [2] - https://qz.com/1145669/googles-true-origin-partly-lies-in-cia-and-nsa-research-grants-for-mass-surveillance https://qz.com/1145669/googles-true-origin-partly-lies-in-ci... [3] - https://qz.com/1145669/googles-true-origin-partly-lies-in-cia-and-nsa-research-grants-for-mass-surveillance https://qz.com/1145669/googles-true-origin-partly-lies-in-ci... [4] - https://twitter.com/mgnr_io/status/1598978315913940994 https://twitter.com/mgnr_io/status/1598978315913940994 [5] - https://www.binance.com/en/feed/post/51123 https://www.binance.com/en/feed/post/51123

MomoXenosaga 4y ago

Crypto shit taking up valuable time and resources from regulators. Don't know about the US but in my country the authorities were very clear that cryptocurrency was for pedos and idiots so let it all burn.