BitMEX founders to each pay $10M fine for violating US laws

Founders of the cryptocurrency exchange BitMEX have pleaded guilty to violating the United States Bank Secrecy Act, the US Department of Justice announced Thursday. Violation of the US bank secrecy act can lead up to a maximum of five years in prison. However, the defendants are yet to receive their sentences from a US federal judge.

Per the press release issued, BitMEX founders Arthur Hayes and Benjamin Delo failed to “establish, implement, and maintain an anti-money laundering (“AML”) program” at the cryptocurrency exchange. As a result, both of them are required to pay $10 million each in criminal fines representing the gains procured while committing the felony.

“They allowed BitMEX to operate as a platform in the shadows of the financial markets,” U.S. Attorney Damian Williams said while announcing the judgment. “Today’s guilty pleas reflect this Office’s continued commitment to the investigation and prosecution of money laundering in the cryptocurrency sector.”

Founded in 2014, BitMEX has an established presence in the United States between 2015 and 2020. However, the pair, along with another co-founder Sam Reed and employee Gregory Dwyer, were charged for violating anti-money laundering requirements by US officials in October 2020. The press release noted:

“As a result of its willful failure to implement AML and KYC programs, BitMEX was in effect a money-laundering platform. For example, in May 2018, Hayes was notified of allegations that BitMEX was being used to launder the proceeds of a cryptocurrency hack.”

The cryptocurrency exchange previously paid $100 million in a settlement fine with the US CFTC and FinCEN in August 2021. The settlement order at the time stated that the exchange failed to implement customer identification programs such as the KYC that prevent money laundering and terror financing.

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