DOJ appoints Forensic Risk Alliance as Binance monitor

Main Points Related to Bitcoin, Web3, Ethereum, and Cryptocurrency:

  • Justice Department appoints Forensic Risk Alliance (FRA) as outside monitor for Binance
  • Binance pleads guilty to violating money-laundering regulations and trade sanctions
  • Binance founder, Changpeng Zhao, sentenced to prison and steps down as CEO
  • Sullivan & Cromwell loses out to FRA for monitorship role due to past controversies
  • FTX vows to compensate customers for losses suffered in bankruptcy

Justice Department Appoints FRA as Binance’s Outside Monitor

The Justice Department has named Forensic Risk Alliance (FRA) as Binance’s outside monitor after the exchange pleaded guilty to breaching U.S. money-laundering regulations and trade sanctions. FRA will oversee Binance’s compliance with the plea agreement and report on its activities to the government.

Sullivan & Cromwell Faces Setbacks in Monitorship Bid

Initially considered the frontrunner, Sullivan & Cromwell lost the monitorship role to FRA due to its controversial past work for FTX, a rival of Binance. Critics raised concerns over the firm’s involvement with FTX before its bankruptcy, alleging failure to uncover fraud by FTX’s co-founder, Sam Bankman-Fried.

FTX Compensates Customers for Bankruptcy Losses

In response to the bankruptcy, FTX has announced plans to fully compensate its customers for any losses incurred, with interest. Despite not securing the monitorship role, Sullivan & Cromwell is expected to oversee a separate five-year monitorship with Binance on behalf of the Treasury Department’s Financial Crimes Enforcement Network.

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