Crypto exchange BitMEX has pleaded guilty to breaching the Bank Secrecy Act (BSA), as revealed by the US Department of Justice on July 10.
US Attorney Damian Williams announced that BitMEX operated in the US without any adequate Anti-Money Laundering (AML) program from 2015 to 2020.
The exchange failed to implement Know Your Customer (KYC) standards, only requiring users to provide an email address. Founders Arthur Hayes, Benjamin Delo, and Samuel Reed were fully aware of this non-compliance with AML requirements and its legal implications for US users, thereby breaching federal law.
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Williams emphasized the severity of the situation, stating:
BitMEX opened itself up as a vehicle for large-scale money laundering and sanctions evasion schemes, posing a serious threat to the integrity of the financial system.
The legal repercussions for those involved could be severe, with potential prison sentences of up to five years and substantial fines.
In 2022, after admitting guilt to AML violations in a case brought by the US Commodity Futures Trading Commission, the three founders were collectively ordered to pay a $30 million civil penalty. They were also each given probation sentences.
BitMEX’s guilty plea highlights the importance for crypto exchanges to comply with US financial regulations to ensure the integrity of the market.
In other news, the US Securities and Exchange Commission (SEC) has recently filed a lawsuit against the crypto-friendly bank Silvergate. The SEC alleges that Silvergate misled investors regarding the effectiveness of its AML compliance program and its oversight of clients, including the now-bankrupt crypto exchange FTX.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.
