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11/07/24
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U.S. Attorney Office in New York Says BitMEX Pled Guilty
On July 10, the United States Attorney’s Office of the Southern District of New York published a press release noting that crypto exchange Bitmex pled guilty to violating the law in terms of willful failure to establish, implement, and maintain an adequate anti-money laundering (AML) program.
Court filings and statements revealed that the crypto exchange, which has long operated through offices in the United States, was required to register with the Commodity Futures Trading Commission (CFTC) as well as to establish and maintain an adequate AML program.
An adequate AML program is meant to prevent exploitation for illegal purposes as well as to protect the integrity of the United States financial system and national security. Instead of implementing an AML program that included a Know Your Customer (KYC) component, the firm decided to flaunt those requirements and asked customers to only provide an email address to use its services.
“By only mandating lax service access credentials, BitMEX not only failed to comply with nationally required anti-money laundering procedures designed to protect the US financial markets from illicit actors and transactions, but knowingly did so to increase the business’s revenue,” said FBI Acting Assistant Director in Charge Christie M. Curtis.
Bitmex willfully evaded U.S. AML laws and lied to a bank regarding the purpose and nature of a subsidiary towards allowing the company to pump money via the United States financial system.
“As a result, 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,” said U.S. Attorney Damian Williams. The violation carries up to five years imprisonment and a fine.
A few months ago, New York District Court Judge Andrew Carter dismissed BitMEX co-founder Ben Delo’s request to dismiss a class-action lawsuit from exchange users alleging price manipulation. Delo was said to be central to alleged manipulation efforts, conceiving, and designing a liquidation system which allowed the crypto exchange to profit from the manipulation.
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