In response to accusations of many sanctions violations, cryptocurrency exchange Poloniex has agreed to pay a $7.59 million settlement to the Office of Foreign Asset Control (OFAC) of the U.S. Treasury Department.
Poloniex Will Pay $7.59 Million to Resolve Claims of Sanctions Violations
The exchange, which is connected to Justin Sun, the founder of Tron, was found to have violated nearly 66,000 different sanctions regimes between January 2014 and November 2019, allowing users from the Crimea, Cuba, Iran, Sudan, and Syria to conduct transactions worth about $15 million. Bill Hughes, a lawyer, tweeted the details on his Twitter account.
OFAC noted that some people from Iran, Cuba, Sudan, Crimea, and Syria continued to conduct digital asset transactions on the platform despite the exchange’s efforts to identify and restrict accounts linked to these countries.
OFAC took into account mitigating circumstances, such as the exchange’s status as a tiny startup during the majority of the alleged violations and Circle’s initiative to improve the sanctions compliance program while in control of the business, when calculating the severity of the penalty. Moreover, the reduced fine imposed on the cryptocurrency exchange was also influenced by Circle and Poloniex’s cooperation with OFAC throughout the inquiry.
About the Exchange
The exchange was once owned by American cryptocurrency firm Circle but is now controlled by several people, including Tron founder Justin Sun. A sanctions compliance program was not formed until May 2015, even though Poloniex began operating in January 2014. Furthermore, this program did not apply retroactively, allowing current users from authorized areas to continue using the platform.