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Coinbase Hit With $50M Fine for Violating AML Laws

2 mins
Updated by Ryan James
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In Brief

  • Coinbase has a history of poor compliance with anti-money laundering laws.
  • The exchange signed a $100 million settlement with the regulators.
  • A well-known economist is disappointed with the settlement.
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The regulators slapped Coinbase with a $50 million fine for violating anti-money laundering laws. It will commit another $50 million to improve compliance.

The bad actors have been using cryptocurrencies for malpractices like money laundering. Regulators globally are brushing up to fight such crime. The UK National Crime Agency recently announced a special crypto unit to tackle the crimes.

Amidst the rising crimes using cryptocurrencies, the American exchange committed $100 million in total as a settlement with regulators.

Compliances Problems With Coinbase

The regulators have found compliance problems with Coinbase since 2020. The American exchange failed to keep up with the anti-money laundering laws, so they initially hired independent consultants.

But the problems continued, and Coinbase faced formal investigations in 2021. The New York Times reports that Coinbase had a backlog of more than 100,000 alerts about potential suspicious customer transactions that were not being properly examined.

The $100 Million Settlement 

With its compliance problems, Coinbase signs a $100 million settlement with the New York State Department of Financial Services. Under this settlement, the exchange will pay $50 million as a fine for violations of anti-money laundering laws and will commit $50 million to enhance its compliance program.

Paul Grewal, the Chief Legal Officer at Coinbase, writes, “We view this resolution as a critical step in our commitment to continuous improvement, our engagement with key regulators, and our push for greater compliance in the crypto space – for ourselves and others.”

Peter Schiff, a chief economist, and well-known Bitcoin critic, expresses his disappointment with Coinbase being allowed to remain in business after violating anti-money laundering laws. The Euro Pacific Bank, owned by the economist, suspended trading on June 30, 2022, following an investigation into suspected tax evasion and money laundering.

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Top crypto platforms in the US | March 2024



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Harsh Notariya
Harsh Notariya excels in delivering SEO-optimized crypto news under tight deadlines. Previously, as a Growth Marketer at Sporty and a Community Consultant at Totality Corp, he significantly boosted community engagement and followers. Harsh also crafted engaging content for top crypto influencer Shivam Chhuneja, blending meme references for an educational yet fun experience. His versatile skills make him a notable figure in crypto journalism.