Arthur Hayes, co-founder of Bitmex, will not go to prison for breaking the US Bank Secrecy Act. Instead, the former CEO of Bitmex cryptocurrency exchange was sentenced to “six months of house arrest and two years of probation.” Hayes has also agreed to pay a $10 million penalty.
The creator and former CEO of bitcoin derivatives exchange Bitmex has been punished for breaching the Bank Secrecy Act, according to the US Department of Justice (BSA). In February, Hayes admitted to breaking the Bank Secrecy Act.
“Hayes, 36, of Miami, Florida, was sentenced to six months of home detention and two years of probation. Hayes also agreed to pay a fine of $10 million dollars representing his pecuniary gain from the offense.”
Department Of Justice
BitMEX CEO Arthur Hayes admits to his doings
Hayes “willfully disobeyed US law that compels businesses to do their share to assist prevent crime and corruption” while establishing a cryptocurrency trading platform “that profited him millions of dollars,” according to US Attorney Damian Williams.
“He purposefully failed to implement and maintain even basic anti-money laundering rules, allowing Bitmex to operate as a platform in the shadows of the financial markets,” Williams continued.
Benjamin Dalo and Sam Reed, two other Bitmex co-founders, also pled guilty and are expected to be sentenced soon.
The two other co-founders, like Hayes, have been sentenced to pay a civil monetary penalty of $10 million apiece.
Lawyers for the 37-year-old American entrepreneur filed a motion for probation with no home detention or community confinement after reaching a plea agreement that would result in a jail term of six to twelve months under federal guidelines.
The authorities claimed that BitMEX had become a “money-laundering platform” due to their incapacity to provide know-your-customer (KYC) and anti-money laundering (AML) services.
Following the lawsuit, the co-founders resigned from the company, and BitMEX agreed to pay a $100 million settlement to the US Commodity Futures Trading Commission (CFTC) and the Financial Crimes Enforcement Network (FCEN) (FinCEN).
For failing to adopt an anti-money laundering strategy at the exchange, Arthur Hayes, former CTO Samuel Reed, and co-founder Benjamin Delo were fined $10 million.