BitMEX Founders Plead Guilty to Violating Bank Secrecy Act

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In Brief
  • BitMEX founders Arthur Hayes and Benjamin Delo have pleaded guilty to violating the US Bank Secrecy Act.

  • As part of a plea deal the two will have to pay $10M each in fines.

  • The deal means that the pair will avoid a custodial sentence.

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The Trust Project is an international consortium of news organizations building standards of transparency.

BitMEX founders Arthur Hayes and Benjamin Delo plead guilty to violating the U.S. Bank Secrecy Act on Thursday. The Department of Justice branded BitMex ‘a money-laundering platform.’

As a consequence of their malfeasance the pair have been instructed to pay $10 million each in fines.

Prosecutor Damian Williams outlined the position of the district of New York, which said that BitMEX violated the Secrecy Act by ‘willfully failing to establish, implement, and maintain an anti-money laundering program.’

“The opportunities and advantages of operating in the United States are legion, but they carry with them the obligation for those businesses to do their part to help in driving out crime and corruption,” said Williams. “Arthur Hayes and Benjamin Delo built a company designed to flout those obligations; they willfully failed to implement and maintain even basic anti-money laundering policies. They allowed BitMEX to operate as a platform in the shadows of the financial markets. Today’s guilty pleas reflect this Office’s continued commitment to the investigation and prosecution of money laundering in the cryptocurrency sector.”

BitMEX founders Arthur Hayes

The findings of the court were that ‘BitMEX was in effect a money-laundering platform.’

BitMEXFounders Avoid Jail

Hayes and Delo accepted that they not only allowed U.S. customers to trade on the platform, but that they profited considerably from it. Among the many violations presented to the court was the case of an individual who traded on the platform with Delo’s specific consent. This is despite Delo knowing the individual was U.S.-based.

The court also found that Hayes and Delo specifically targeted U.S. customers through influencer marketing. Hayes made frequent US television appearances to further expose U.S. investors to the company.

Hayes and Delo each plead guilty to one count of violating the Bank Secrecy Act. The maximum penalty for the crime is five years in prison. 

Having pleaded guilty, the two men will avoid a custodial term.

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Robert D Knight is a journalist and copywriter who has specialized in crypto for over four years. His varied experience includes freelancing, in-project contracts, agency work, and PR, giving him a holistic view of the blockchain industry.

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