Changpeng Zhao, founder and CEO of Binance, attends the Viva Technology conference on innovation and startups at the Porte de Versailles exhibition center in Paris on June 16, 2022.
Benoit Tessier | Portal
U.S. prosecutors on Friday asked a judge to tighten bail conditions for billionaire Binance founder Changpeng “CZ” Zhao as he awaits sentencing in April on charges of violating a federal anti-money laundering law, court records show.
Zhao pleaded guilty in late November to failing to maintain an effective anti-money laundering program in violation of the Bank Secrecy Act, while also resigning as Binance CEO.
Under the proposed bail, Zhao would be required to give prosecutors and investigators at least three days' notice of any travel within the country to give them time to raise any objections.
The new bail conditions would also require Zhao to surrender his current Canadian passport and would prohibit him from applying for a new passport without the court's permission. He would also be prohibited from changing his place of residence without prior consent.
Zhao's lawyers rejected the proposal, the filing said. A lawyer for Zhao did not immediately respond to CNBC's request for comment.
Judge Richard Jones banned Zhao from traveling outside the United States in mid-December after finding that Zhao's “enormous wealth” and lack of ties to the U.S. put him at risk of absconding if he were allowed to return to his home in the United Arab Emirates .
Prosecutors' latest filing in U.S. District Court in Seattle said investigative officials recommended further restricting Zhao's movements and allowing him to travel only to the Western District of Washington and the county where he currently resides.
Pretrial Services also recommended “a site monitoring condition,” the filing said in a footnote. The file does not specifically ask the judge to impose this condition.
Read more about CNBC's politics coverage
Zhao, a Canadian citizen, is free in the United States on a $175 million personal recognizance bond. His lawyers argued that he had accepted responsibility for his actions and pointed out that he would pay a $150 million personal penalty to the U.S. Commodity Futures Trading Commission as part of his agreement with the government.
The Justice Department announced Zhao's guilty plea coupled with an agreement by Binance to pay more than $4.3 billion to resolve multiple federal charges. At the time, Attorney General Merrick Garland called it “one of the largest corporate penalties in U.S. history.”
Federal sentencing guidelines indicate that Zhao faces up to 18 months in prison. Prosecutors have reportedly considered seeking a harsher sentence.
A December 22 letter to the court, which was released redacted in late January, revealed that Zhao had asked to return to the UAE for up to four weeks to care for someone in his life who was undergoing surgery should.
Zhao offered to pledge all of his equity to Binance US to allay concerns about his potential flight risk, according to the letter. In the company's last financing round two years ago, this equity was worth $4.5 billion, Zhao's lawyers said in the letter.
Jones denied the travel request on Dec. 29.