The announcement puts an end to a situation that started in 2020 when the US issued charges against the founders of BitMEX and the platform for carrying out activities without complying with federal registration protocols.
Co-founders of cryptocurrency exchange BitMEX, Arthur Hayes and Benjamin Delo, have pleaded guilty to transgressing the US Bank Secrecy Act.
After a robust legal conflict, the US Department of Justice (DOJ) announced that Hayes and Delo “did not set up, implement, or sustain an anti-money laundering protocol on their crypto-asset network. Both pleaded guilty in federal court and had to pay at least USD$10 million as a fine.
According to the DOJ, the co-founders could deal with at least five years in prison, although their sentences are still unclear. The fine the accused had to pay is the profit obtained from the illegal activity.
BitMEX Founders Put an End to this Legal Episode
The news ended a story that began in 2020 when the Department of Justice and the Commodity Futures Trading Commission issued various federal charges against BitMEX. At the time, authorities claimed that Hayes, Delo, and the company’s other owner, Samuel Reed, joined efforts to avoid US AML regulation policies by carrying out their activities abroad but allowing US customers to perform transactions on the network.
CFTC charges got added, claiming that BitMEX allowed US customers to carry out transactions with cryptocurrency derivatives without the proper license. Last year, the company solved these issues by giving regulatory entities a $100 million fine.
BitMEX is a cryptocurrency trading platform located in Seychelles; this entity brings derivatives and a margin trade up to 100x. The exchange offered their assistance without any know-your-customer (KYC) confirmation or AML measures valid the US.
In February, the DOJ said that such failure in regulatory compliance essentially converted BitMEX into a platform ideal for money laundering procedures. He also expressed that the company also counts on a list of clients located in Iran, a sanctioned region.
Two Other Executives are Still Fighting
Hayes, who resigned as CEO of the company once the accusations started to land upon him, told news outlets that he dealt with the entire responsibility for his actions desires to reach the time when he could put this matter behind and start a new life.
On the other hand, a spokesperson explained on behalf of Delo that the founder managed to solve the Bank Secrecy Act accusations with the US Department of Justice through an agreement. He seemed regretful about BitMEX, the cryptocurrency derivatives platform he co-founded, lacking a functional client identification protocol.
It is unclear whether Reed and Gregory Dwyer, the first BitMEX representative who also got accused in 2020, intend to plead guilty to the charges imposed on him. In September of last year, Dwyer’s lawyers reached an agreement regarding his extradition to the US to carry out those legal actions in that nation.
By: Jenson Nuñez
