Crypto Exchange Poloniex Agrees A $7.6 Million Settlement Fee With OFAC

Twitter icon  •  Published 9개월 전  •  Hassan Maishera

The U.S. Treasury Department's Office of Foreign Asset Control (OFAC) has revealed that crypto exchange Poloniex will pay $7.6 million as a settlement for its sanctions violations.

TL;DR

  • Poloniex crypto exchange has agreed on a settlement with the U.S. Treasury Department's Office of Foreign Asset Control (OFAC).

  • The crypto exchange will pay $7.6 million for nearly 60,000 violations.

Poloniex To Pay $7.6 Million In Fines

Poloniex LLC, a U.S. entity previously affiliated with the Poloniex crypto exchange, has agreed to pay $7.59 million to the U.S. Treasury Department's Office of Foreign Asset Control (OFAC).

The payment is the crypto exchange’s settlement with OFAC, the sanctions agency revealed on Monday. 

The agency stated that Poloniex agreed to remit $7,591,630 to settle its potential civil liability for apparent violations of sanctions against Crimea, Cuba, Iran, Sudan, and Syria. 

OFAC added that between January 2014 and November 2019, the Poloniex trading platform allowed customers apparently located in sanctioned jurisdictions to engage in online digital asset-related transactions—consisting of trades, deposits, and withdrawals—with a combined value of $15,335,349, despite having reason to know their location based on both Know Your Customer information and internet protocol address data.

Poloniex launched in January 2014, and at the time, the crypto exchange did not have a compliance program. The compliance program was launched in May 2015 and was not retroactive, allowing customers from sanctioned countries who were already registered on the platform to continue using their services. 

OFAC added that;

"Although Poloniex made efforts to identify and restrict accounts with a nexus to Iran, Cuba, Sudan, Crimea and Syria pursuant to its compliance program, certain customers apparently located in these jurisdictions continued to use Poloniex’s platform to engage in online digital asset-related transactions."

Poloniex has undergone changes in recent years and is now owned by a consortium of entities, which includes backing from Tron creator Justin Sun. The crypto exchange was at one point owned by U.S. crypto company Circle.

In 2022, Poloniex and Huobi announced a strategic partnership that could include boosting the Huobi Token ecosystem, which Justin Sun serving as an advisor to Huobi. 

In its report on Monday, OFAC admitted that Poloniex LLC was a small startup at the time of most of the alleged violations. Furthermore, OFAC added that Circle improved Poloniex's sanctions compliance program during its time owning the company. 

The sanctions agency said Circle and Poloniex cooperated with it, which was another point in favor of the crypto exchange.

 

Author

Hassan Maishera

Hassan is a Nigeria-based financial content creator that has invested in many different blockchain projects, including Bitcoin, Ether, Stellar Lumens, Cardano, VeChain and Solana. He currently works as a financial markets and cryptocurrency writer and has contributed to a large number of the leading FX, stock and cryptocurrency blogs in the world.

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