The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) fined Bittrex $24 million and forced them to make a $29 million settlement with the department’s Financial Crimes Enforcement Network (FinCEN) (FinCEN) (FinCEN) (FinCEN). The fines derive from the exchange’s violations of anti-money laundering legislation, as well as sanctions applied on people of specified governments and territories.
“Bittrex failed to prevent persons apparently located in the Crimea region of Ukraine, Cuba, Iran, Sudan, and Syria from using its platform to engage in approximately $263,451,600.13 worth of virtual currency-related transactions between March 2014 and December 2017,” the department said in a statement. According to the statement, the applicable sanctions regimes ban US people from participating in transactions with these states.
According to the authorities, based on internet protocol (IP) addresses collected from its users, the exchange, which is located in Liechtenstein and Bermuda, had reasons to infer that these persons were stationed in sanctioned territories.
“However, Bittrex was not verifying this client information for terms linked with sanctioned jurisdictions at the time of the transactions.” According to the statement, “this information was not purposely self-disclosed.”
“For years, Bittrex’s AML program and SAR reporting shortcomings exposed the US financial system to threat actors,” observed Himamauli Das, Acting Director of FinCEN. “The flaws of Bittrex exposed users to high-risk counterparties including as sanctioned nations, darknet markets, and ransomware offenders.” “Since its beginning, Bittrex has worked diligently and in good faith to comply with all government requirements,” the exchange noted in a statement given by The New York Times.