Payments

Coinbase to shell out $50M fine to New York

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January 6, 2023

Coinbase, a cryptocurrency exchange, will pay a $50 million penalty to New York's Department of Financial Services due to an issue where the exchange opened accounts without proper background checks. The DFS claimed the practice opened the door for money laundering and other bad actors, according to a report by The Wall Street Journal.

The company will also have to invest $50 million into a compliance program over the next two years.

"It is critical that all financial institutions safeguard their systems from bad actors," Adrienne Harris, superintendent of Financial Services, said in a statement.

Paul Grewal, chief legal officer at Coinbase, said the company "has taken substantial measures to address these historical shortcomings," and it "remains committed to being a leader and role model in the crypto space, including partnering with regulators when it comes to compliance."