Pardoned Binance Founder Changpeng Zhao Faces New Lawsuit Alleging $415 Million Transfer to Terrorist Organizations

Binance founder Changpeng Zhao, recently pardoned by US President Donald Trump, is now facing serious allegations related to terrorist financing.

According to a new lawsuit filed in US federal court, Zhao is accused of transferring hundreds of millions of dollars to terrorist organizations including Hamas and Hezbollah following the October 7 attack on Israel.

The Financial Times reports that families of victims who were killed, injured, or taken hostage during the assault have filed legal action claiming that Zhao and his cryptocurrency company facilitated funding to these terrorist groups.

The lawsuit specifically accuses Zhao and his close associate, Guangying "Heina" Chen, of deliberately establishing Binance as a platform that would enable criminals and terrorists to conduct global money laundering operations.

Plaintiffs claim that well before the October 7, 2023 attack, Binance was aware that terrorist organizations including Hamas, Iran's Islamic Revolutionary Guard Corps, Hezbollah, and Palestinian Islamic Jihad were regularly conducting transactions on its platform, with over $50 million in cryptocurrency allegedly flowing to their accounts.

More seriously, the lawsuit alleges that Binance's own company-controlled wallets—not just user accounts—transferred more than $300 million to terrorist-linked accounts before the Hamas attack and an additional $115 million after the attack occurred.

The legal filing states: "Binance not only knowingly provided financial services to Hamas; it actively tried to shield its Hamas customers and their funds from scrutiny by US regulators or law enforcement—a practice that continues to this day."

According to CNBC, the attorneys representing the victims claim that even after Binance paid a substantial $4.3 billion fine in November 2023 for violations of US anti-money laundering and sanctions regulations, terror-related payments continued to move through the platform.

Zhao had previously been sentenced to four months in prison after pleading guilty to failing to implement adequate anti-money laundering protections. In October, President Trump pardoned him, claiming Zhao had been unfairly targeted by the Biden administration as part of what Trump described as a "war on cryptocurrency."

The White House had stated that US agencies pursued Zhao despite the fact that he wasn't accused of fraud and there were no direct victims identified in his previous case.

In this new lawsuit, the victims are seeking compensatory damages and requesting "treble damages"—a legal provision that allows victims of international terrorism to receive compensation equal to three times their actual losses.