Having Failed To Comply With The Anti Money Laundering Law, The Coinbase Crypto Exchange Agreed To Pay A Fine Of IDR 1.5 Trillion

Coinbase paid fines to regulators for failing to control money laundering activities committed by criminals. (Photo; Doc. EqueInvertir)

JAKARTA The US crypto exchange giant Coinbase reportedly approved the payment of a fine of US$100 million (approximately Rp1.5 trillion) to the New York Department of Financial Services (NYDFS) on January 4, 2023.

NYDFS accused Coinbase of failing to comply with the Money Laundering Anti-Law from 2020 to 2021. Coinbase has agreed to pay a fine of 50 million dollars and another 50 million dollars will be used to implement necessary anti-money laundering (AML) background checks.

"Coinbase has no adequate personnel, resources, and tools needed to follow this warning, and deposits are rapidly growing to an unmanaged level," the approval order signed by Adrienne Harris's supervisor detailed.

"At the end of 2021, Coinbase has unreviewed deposits of transaction monitoring warnings growing to more than 100,000 (many of them months of age), and customer deposits requiring increased due diligence exceeding 14,000," the certificate added.

According to Bitcoin.com News, compliance investigations began in 2020 and the alleged lack of background check control began in 2018. Coinbase agreed at the time to hire independent examiners to ensure AML and know-your-customer (KYC) guidelines were followed.

However, compliance issues remain and New York regulators decided to take action in 2021. "We have been very outspoken about the issue of illicit financing in crypto space. That is why our framework holds crypto companies with the same standards as banks," said the Harris watchdog.

Responding to the news, Coinbase (COIN) shares experienced a price spike. COIN rose by 6.74 percent on Wednesday, January 4, 2023. The company stated in its blog post regarding this matter. According to Coinbase, it "committed to US $ 50 million in compliance program investment over the next two years."

We view this resolution as an important step in our commitment to sustainable improvement, our engagement with key regulators, and our push for greater compliance in the crypto space - for ourselves and others," Coinbase wrote.