CoinEx fined $1.7 million and reached a settlement with the New York State Attorney General’s Office (NYAG)CoinEx fined $1.7 million by NYAG
Compiled by: AiYing Compliance
New York Attorney General Letitia James filed a lawsuit against CoinEx in February 2023, alleging that it had traded AMP, LBRY, LUNA, Rally and other tokens without registering in New York State, violating the Martin Act, which was enacted in 1921. According to the regulations, it is illegal for any unregistered trader, broker or salesman to offer or sell securities. This act is also considered one of New York State’s strictest anti-fraud and securities regulatory laws. Therefore, three months later, the two parties reached a settlement, and CoinEx will also pay a fine of $1.7 million and a refund.
According to the investigation by NYAG, CoinEx processed more than USD 2.8 billion in transactions from New York residents between 2017 and 2022. Additionally, the exchange failed to implement sufficient anti-money laundering controls, which could allow criminals to use the platform for money laundering activities.
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As part of the settlement, CoinEx has agreed to pay a $1.7 million fine and register with NYAG. It has also agreed to implement a series of new anti-money laundering controls, including customer due diligence, transaction monitoring, and reporting requirements. And it will not accept new users from the United States until it obtains legal operating qualifications.
NYAG’s enforcement action against CoinEx is a reminder that cryptocurrency exchanges operating in New York must comply with state law. NYAG has been actively regulating the cryptocurrency industry and has taken enforcement action against many other exchanges.
The following are some highlights of NYAG’s enforcement action against CoinEx:
1. Cryptocurrency exchanges operating in New York must register with NYAG.
2. Cryptocurrency exchanges must comply with national anti-money laundering laws.
3. NYAG is actively enforcing cryptocurrency regulations.
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