BitMEX Anticipates No More Fines for AML Violation

BitMEX refers to the DOJ’s BSA charge as a past issue, emphasizing the company’s compliance enhancements and the founders’ prior penalties.

BitMEX, a cryptocurrency derivatives exchange, disregarded its violation of the Bank Secrecy Act (BSA) in the United States as “old news” from 2020. The company has announced its intention to request an expedited sentencing hearing, which implies that no further allegations will be pursued.

US Attorney Damian Williams announced BitMEX’s admission to providing crypto trading services without a meaningful Anti-Money Laundering (AML) program on July 10.

BitMEX asserted that its founders, Arthur Hayes, and Benjamin Delo, had already pleaded guilty to the violation and paid the penalties in 2022 in response to the BSA charge.

At that time, the proprietors of BitMEX had acknowledged that they had “willfully failed to establish, implement, and maintain an Anti-Money Laundering program” at their crypto derivatives exchange.

The litigation led to the implementation of verification mechanisms to prevent US citizens from using BitMEX.

BitMEX is facing charges.

Each of Hayes and Delo had consented to pay $10 million in criminal penalties for BitMEX’s BSA violations. Subsequently, the exchange anticipates that the US Department of Justice (DOJ) will not impose additional penalties.

“We have accepted the BSA charge, will seek an expedited sentencing hearing, and argue that no further fine should be imposed, given the substantial amounts already paid by our founders under the BSA charges brought against them, and under our no admission/no denial settlements with the CFTC and FinCEN in 2021.”

BitMEX subsequently announced that its Know Your Customer and AML programs have been subjected to independent audits. The conclusion was that this charge does not affect our business operations.

Payment of penalties for anti-money laundering (AML) violations

On June 16, Delo was sentenced to 30 months of probation for the BSA violation, while Hayes was sentenced to two years and six months of home detention on May 21.

Nevertheless, prosecutors had contended that Delo should be sentenced to a penitentiary term comparable to that of Hayes. After federal prosecutors initially filed charges on April 7, Hayes voluntarily surrendered to US authorities in Hawaii six months later. His attorneys responded by stating:

“Mr. Hayes voluntarily appeared in court and looks forward to fighting these unwarranted charges.”

The highest penalty for pleading guilty to supporting money laundering in the United States is typically five years of imprisonment.