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BitMEX Executive Pleads Guilty to Violating Bank Secrecy Act

2 mins
Updated by Kyle Baird
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In Brief

  • Dwyer pleaded guilty to violating the Bank Secrecy Act and faces a maximum sentence of five years.
  • Founders Arthur Hayes, Benjamin Delo, and Samuel Reed have already pleaded guilty to the same count.
  • Such cases warn crypto companies not to flout the law, and the number of these cases has been rising.
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A high-ranking BitMEX executive, Gregory Dwyer, has pleaded guilty to violating the Bank Secrecy Act. He faces a maximum sentence of up to five years in prison.

BitMEX executive Gregory Dwyer has pleaded guilty to violating the Bank Secrecy Act, according to a press release published by the United States Department of Justice on Aug. 8. Dywer was the Head of Business Development at BitMEX and “willfully caused BitMEX to fail to establish and maintain an AML program, including a program for verifying the identity of BitMEX’s customers.” The case is being conducted in the Southern District of New York.

Dwyer pleaded guilty to one count of violating the Bank Secrecy Act, which could result in a maximum of five years in prison. He has also agreed to pay $150,000 for pecuniary gain from his actions.

The case is a part of the U.S. authorities’ investigation of BitMEX. Founders Arthur Hayes, Benjamin Delo, and Samuel Reed have also pleaded guilty to the same count. U.S. Attorney Damian Williams said of the most recent development,

“With this plea, this Office has now obtained criminal convictions against all three founders, as well as a high-ranking employee at BitMEX, for willful violations of anti-money laundering laws. 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.”

The U.S. government has been strict about any violation of KYC and AML rules. The case against BitMEX was one of the earliest and most significant cases against a crypto company. The derivatives exchange has since taken a strong stance on compliance.

Last year, BitMEX settled CFTC and FinCEN cases with a $100 million fine. The fine was split equally between the two entities.

Authorities believe that such cases will send a strong sign to crypto companies and that there is no room for flouting the law. “Crypto Mom” Hester Peirce also said that the BitMEX arrests were a clear message to those operating in the market.

Crypto companies are wising up and do not want to risk incurring the wrath of the United States Securities and Exchange Commission, Department of Justice, Commodity Futures Trading Commission, and Treasury. All of these bodies are keeping a close eye on the crypto market, just as lawmakers are beginning to work on a broad level of crypto regulation.

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Rahul Nambiampurath
Rahul Nambiampurath's cryptocurrency journey first began in 2014 when he stumbled upon Satoshi's Bitcoin whitepaper. With a bachelor's degree in Commerce and an MBA in Finance from Sikkim Manipal University, he was among the few that first recognized the sheer untapped potential of decentralized technologies. Since then, he has helped DeFi platforms like Balancer and Sidus Heroes — a web3 metaverse — as well as CEXs like Bitso (Mexico's biggest) and Overbit to reach new heights with his...