A San Francisco Crypto Exchange Settles with US Treasury Department for Violating Sanctions
A San Francisco-based cryptocurrency exchange, CoinList Markets (CLM), has reached an agreement with the US Treasury Department’s Office of Foreign Assets Control (OFAC) to settle potential civil liability for violating US sanctions related to Russia and Ukraine. The OFAC states that CLM will pay over $1.2 million as a settlement for processing hundreds of transactions that violated the government’s embargo policies.
The OFAC acknowledges that CLM implemented some sanction measures, such as denying access to users from prohibited jurisdictions and rejecting applications from individuals in sanctioned nations. However, the exchange’s screening procedures fell short, allowing some Russian residents with addresses in Crimea to open accounts.
CLM faces a maximum statutory civil monetary penalty of $327,306,583. However, the settlement amount takes into account CLM’s remedial measures to improve compliance. $300,000 of the settlement will be suspended pending satisfactory completion of CLM’s compliance commitments, and the exchange has agreed to invest $300,000 in additional sanctions compliance controls.
Hot Take: Crypto Exchange Pays Price for Sanctions Violations
A San Francisco crypto exchange has learned the hard way about the consequences of violating US sanctions. CoinList Markets (CLM) has agreed to pay over $1.2 million as a settlement for processing transactions that violated embargo policies related to Russia and Ukraine. While CLM implemented some sanction measures, its screening procedures failed to prevent Russian residents with addresses in Crimea from opening accounts. The settlement amount reflects CLM’s efforts to improve compliance and includes a suspension of $300,000 pending satisfactory completion of compliance commitments. This case serves as a reminder that crypto exchanges must prioritize adherence to sanctions regulations to avoid hefty penalties.
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