Coinbase Cuts $100-M Settlement With NY Regulator

Coinbase, one of the most popular US crypto-trading platforms, agreed to a $100 million settlement after New York regulators found “significant failures” to comply with the state’s anti-money-laundering laws, Allison Morrow reported for CNN Business.

Photo Insert: Coinbase’s less-than-adequate compliance practices left it vulnerable for bad actors to leverage it for “serious criminal conduct.”

The settlement includes a $50 million penalty Coinbase must pay to the New York Department of Financial Services and a pledge to spend $50 million to strengthen the company’s compliance program over the next two years.

After one of the buzziest IPOs of the year in the spring of 2021, Coinbase’s stock has tumbled some 90% as crypto fervor has waned and losses have spread throughout the industry.

Coinbase’s less-than-adequate compliance practices left it vulnerable for bad actors to leverage it for “serious criminal conduct,” NYDFS said in a statement Wednesday, including “possible money laundering, suspected child sexual abuse material-related activity, and potential narcotics trafficking.”

The publicly traded company, which is valued at $7.6 billion, said it had taken “substantial measures” to address historical shortcomings.

“Although we have not always been perfect, our goal has always been and will always be to build the most trusted, compliant, and secure crypto exchange in the world,” said Paul Grewal, Coinbase’s chief legal officer, in a statement.

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