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BitMEX Dismisses Guilty Plea for Money Laundering Violations as “Old News”
After the U.S. Justice Department announced Wednesday that cryptocurrency exchange BitMEX had pleaded guilty to violating the Bank Secrecy Act (BSA) between 2015 and 2020, the company said it would seek expedited sentencing, arguing that it should not face additional fines beyond those already imposed in a previous case.
“The accusation against the BSA is old news,” BitMEX said in a statement. Prepared Affirmation“This is the same charge that was brought against our founders in 2020 regarding BitMEX’s operations up until September 2020. BitMEX has long since completely cleaned up its operations, and there is nothing new in this charge.”
BitMEX founders Arthur Hayes and Benjamin Delo pleaded guilty in February 2022 to similar charges and agreed to pay a separate $10 million criminal fine. The company said those penalties should be sufficient.
“No additional fines should be imposed, given the significant amounts already paid by our founders in connection with the BSA charges against them, and as part of our non-admission/non-denial agreements with the CFTC and FinCEN in 2021,” BitMEX said.
The Ministry of Justice announcement BitMEX said it engaged in “willful evasion” of U.S. anti-money laundering laws by knowingly serving U.S. customers but only requiring an email address to create an account.
“BitMEX’s policies in place to prevent these types of transactions were ineffective or easily circumvented to serve BitMEX’s primary purpose of obtaining revenue through the U.S. market without regard to U.S. criminal laws,” the department said.
The agency said BitMEX was aware of its obligations to implement know-your-customer (KYC) measures to prevent money laundering, but “chose to disregard these requirements.”
“As a result, BitMEX opened itself up to large-scale money laundering and sanctions evasion schemes, posing a serious threat to the integrity of the financial system,” U.S. Attorney Damian Williams said in the statement.
He noted that the case against the company was based on the findings of the previous investigation, as the lack of anti-money laundering programs had been “admitted in federal court in 2022” by the company’s founders.
For its part, BitMEX said its anti-money laundering controls are now “best in class” and are independently audited.
“BitMEX’s compliance standards and activities have changed significantly since the period subject to the BSA tax,” the company wrote. “Needless to say, this tax has no impact on our business operations.”
The Justice Department said BitMEX faces a maximum sentence of five years in prison and a fine. It is unclear how the company would serve a prison sentence if handed down by the court.
The Justice Department did not immediately respond to a request for comment from Decrypt.