Top exec at BitMEX pled guilty US Bank Act violations, pays $150K fine

abdelaziz Fathi

BitMEX’s former head of business development, Gregory Dwyer pled guilty to violating the US Bank Secrecy Act (BSA) and allowing customers to use the platform to circumvent the federal anti-money laundering rules.

Dwyer agreed to ante up a $150,000 fine, which is reportedly representing the profits earned via his criminal behavior. However, the last ruling for BitMEX’s senior manager will be decided by a federal judge later on.

The penalty closes yet another legal chapter that began two years ago when Dwyer, in addition to BitMEX’s co-founders were accused of “willfully failing to establish, implement, and maintain an anti-money laundering (AML) program.”

“Today’s plea reflects that employees with management authority at cryptocurrency exchanges, no less than the founders of such exchanges, cannot willfully disregard their obligations under the Bank Secrecy Act,” U.S. Attorney Damian Williams said in a press release.

The news comes five months after BitMEX founders, Arthur Hayes, Samuel Reed and Benjamin Delo, pled guilty in a US federal court and agreed to each pay a $10 million fine.  While each man faced a possible five years behind bars for their crimes, media reports at the time claimed they had worked out a deal to serve a maximum of six-to-12 month.

In 2020, FBI prosecutors indicted BitMEX’s owners and top executives. The four men stood accused of violating the Bank Secrecy Act, evading money laundering regulations and operating an unlicensed business. The indicted officials allowed BitMEX to operate as a platform “in the shadows of the financial markets,” the DoJ said.

In August 2020, BitMEX paid $100 million in a settlement with the US authorities over allegations it broke CFTC and FinCEN rules by allowing Americans to trade on the platform.

US authorities had sued BitMEX with a long list of charges that are focused on whether the pioneering exchange acted as a broker without having regulatory approval. Moreover, the complaint charged the platform with acting as a counterparty to leveraged crypto trades, failing to implement KYC procedures and anti-money laundering procedures.

The CFTC estimates that BitMEX has facilitated ‘trillions of dollars’ in cryptocurrency derivatives transactions, received $11 billion in deposits and earned more than $1 billion in fees since beginning the operations in 2014.

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