Crypto exchange OKX has settled charges with the DoJ following an investigation into facilitating over $5 billion worth of suspicious transactions.
Almost a year ago on February 24, 2024, the American division of OKX, OKcoin, received a subpoena from the Commodity Futures Trading Commission (CFTC), marking the start of an investigation into the exchange. An internal document was circulated among OKX staff in January of the same year that emphasized the importance of whistleblowing when it comes to policy violations or suspected illegal behavior.
OKZ has now confirmed in a press release that it has paid over $500 million in penalties and forfeited fees via an OKX affiliate, Aux Cayes FinTech Co. Ltd. It also acknowledged that the exchange had not obtained a license to operate as a money transmitter and in doing so left legacy compliance gaps that were used by US customers to trade on the company’s global platform.
“The total number of US customers involved – which are no longer on the platform – amounted to a small percentage of the Company’s worldwide customer population,” explained the statement. “There were no allegations of customer harm, no charges against any Company employee and no government-appointed monitor as part of the settlement.”
The DoJ’s press release on the case cited more than $5 billion worth of “suspicious transactions and criminal proceeds” as a result of the lack of a money transmitter.
What are the next steps for OKX?
OKX claims that prior to and throughout the investigation, the exchange has taken steps to build “a robust compliance infrastructure”. That includes improving its customer risk assessments, employing anti-money-laundering tools, and creating a 150-person financial crime and blockchain intelligence and investigative team, among other measures.
OKX is not the only crypto exchange that went under the microscope for illicit activities, with an investigation opened into Binance earlier this year and fears rising for more consumer-focused crypto scams in the wake of the growing number of meme coins.
Featured image: Midjourney
