Crypto exchange platform BitMEX pleads guilty to violations of the Bank Secrecy Act, according to the Department of Justice (DOJ).
In a new press release, the DOJ says BitMEX, founded by crypto entrepreneur Arthur Hayes in 2014, violated the law by failing to establish and enforce an adequate anti-money laundering (AML) protocol.
BitMEX and its executives were accused of deliberately failing to register with the Commodity Futures Trading Commission (CFTC), failing to establish an AML program and circumventing mandatory know your customer (KYC) laws.
“The company and its executives knew that because BITMEX operated in the United States, including serving U.S. customers, it needed to implement an AML program that included a KYC component, but chose to flaunt those requirements and only require customers to provide an email address to use BITMEX services.
Indeed, senior executives were all aware that customers residing in the United States continued to have access to BITMEX’s trading platform until at least in or around 2018 and that BITMEX’s policies nominally in place to prevent such trading were toothless or easily overridden done to serve BITMEX’s business purpose.
According to U.S. Attorney Damien Williams, BitMEX’s disregard for the law posed a serious threat to the U.S. financial system.
“BitMEX has opened itself up as a vehicle for large-scale money laundering and sanctions evasion, posing a serious threat to the integrity of the financial system. Today’s guilty plea further signals that cryptocurrency companies must comply with U.S. law when benefiting from the U.S. market.”
According to the press release, violation of the Bank Secrecy Act carries a maximum penalty of five years behind bars and a fine.
In August 2022, BitMEX director Gregory Dwyer admitted he was guilty of similar violations of the Bank Secrecy Act. According to a press release at the time, Dwyer admitted that he “intentionally failed to establish, implement and maintain an anti-money laundering program at BitMEX.”
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