Coinbase to pay $100M in settlement with New York regulators

Jan 3, 2023, 6:31 PM | Updated: Jan 4, 2023, 10:07 am
FILE - An advertisement for Coinbase, center, is displayed on NASDAQ billboard in Times Square, New...

FILE - An advertisement for Coinbase, center, is displayed on NASDAQ billboard in Times Square, New York, Thursday, Nov. 4, 2021. New York announced a $100 million settlement with Coinbase on Wednesday over what state officials called significant failures in the cryptocurrency trading platform's systems for spotting potential criminal activity. (AP Photo/Seth Wenig, File)

(AP Photo/Seth Wenig, File)

NEW YORK (AP) — New York announced a $100 million settlement with Coinbase on Wednesday over what state officials called significant failures in the cryptocurrency trading platform’s systems for spotting potential criminal activity.

According to the state Department of Financial Services, Coinbase’s anti-money-laundering program and its system for monitoring transactions for suspicious activity were inadequate for a company of Coinbase’s size and complexity. The department said that the volume of alerts generated by Coinbase’s transaction monitoring system grew so fast that reports of suspicious activity were sometimes filed months after the suspicious activity was first known to Coinbase.

“It is critical that all financial institutions safeguard their systems from bad actors, and the Department’s expectations with respect to consumer protection, cybersecurity, and anti-money laundering programs are just as stringent for cryptocurrency companies as they are for traditional financial services institutions,” Financial Services Superintendent Adrienne A. Harris said in a news release. “Coinbase failed to build and maintain a functional compliance program that could keep pace with its growth.”

Under the terms of the settlement, Coinbase will pay a $50 million penalty to New York state and will invest another $50 million in its compliance program. An independent monitor installed by the state will work with Coinbase for a year to oversee compliance.

Paul Grewal, Coinbase’s chief legal officer, said in a statement that the company has taken substantial measures to address the shortcomings identified by the New York investigation “and remains committed to being a leader and role model in the crypto space, including partnering with regulators when it comes to compliance.”

Grewal added, “We believe our investment in compliance outpaces every other crypto exchange anywhere in the world, and that our customers can feel safe and protected while using our platforms.”

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - An American flag is flown next to the Chinese national emblem during a welcome ceremony at t...
Associated Press

US moving ahead on plan to down Chinese balloon over ocean

The Biden administration is moving forward with a plan to shoot down a large Chinese balloon suspected of conducting surveillance on the U.S. military, by bringing it down once it is above the Atlantic Ocean where the remnants could potentially be recovered, according to two U.S. officials.
14 hours ago
In this photo provided by the U.S. Coast Guard Pacific Northwest, a Coast Guard rescue swimmer reac...
Associated Press

Man rescued by Coast Guard wanted in ‘Goonies’ fish incident

A man who was saved by a Coast Guard rescue swimmer at the mouth of the Columbia River as a massive wave rolled the yacht he was piloting Friday was wanted for a bizarre incident in which police said he left a dead fish at the Astoria, Oregon, home featured in the classic 1985 film, "The Goonies."
14 hours ago
FILE - An Amazon company logo on the company's building in Schoenefeld near Berlin, Germany, March ...
Associated Press

Amazon violated labor law with delivery app

A Spanish court has ruled that Amazon broke labor laws by forcing more than 2,000 delivery drivers to use an app that the company controlled for scheduling work and payments and requiring them to use their own cars and cellphones on the job.
14 hours ago
Harvard's Hasty Pudding Theatricals Woman of the Year Jennifer Coolidge, center, rides in a parade ...
Associated Press

Hasty Pudding celebrates Coolidge as its Woman of the Year

CAMBRIDGE, Mass. (AP) — “The White Lotus” actress Jennifer Coolidge is being celebrated Saturday as the 2023 Woman of the Year by Harvard University’s Hasty Pudding Theatricals. As the oldest theatrical organization in the nation and one of the oldest in the world, since 1951, Hasty Pudding Theatricals has bestowed this award annually on women […]
2 days ago
Members of the ground crew secure the site after a United airlines flight made an emergency landing...
Associated Press

Engine problems force Vegas-bound flight to land in Nebraska

LINCOLN, Neb. (AP) — A United Airlines flight headed from Chicago to Las Vegas made an unplanned stop in Nebraska on Saturday after the pilot reported engine problems. Mark Grant, a communications operator at the Lincoln Airport, said 326 passengers and crew members were aboard the Boeing 777 when it took off from O’Hare International […]
2 days ago
CORRECTS TO KINGSTOWN, NOT KINGSTON - In this photo provided by Brian Branch, a large balloon drift...
Associated Press

Eyes on the sky as Chinese balloon shot down over Atlantic

Eyes were locked on the Carolina skies Saturday as the suspected Chinese spy balloon that traversed the U.S. over the past week drifted over the Atlantic Ocean and was shot down by a fighter jet. In Myrtle Beach, South Carolina, a crowd lining the beach boardwalk cheered as the balloon was struck by a missile […]
2 days ago

Sponsored Articles

safety from crime...

As crime increases, our safety measures must too

It's easy to be accused of fearmongering regarding crime, but Seattle residents might have good reason to be concerned for their safety.
Comcast Ready for Business Fund...
Ilona Lohrey | President and CEO, GSBA

GSBA is closing the disparity gap with Ready for Business Fund

GSBA, Comcast, and other partners are working to address disparities in access to financial resources with the Ready for Business fund.
SHIBA WA...

Medicare open enrollment is here and SHIBA can help!

The SHIBA program – part of the Office of the Insurance Commissioner – is ready to help with your Medicare open enrollment decisions.
Lake Washington Windows...

Choosing Best Windows for Your Home

Lake Washington Windows and Doors is a local window dealer offering the exclusive Leak Armor installation.
Anacortes Christmas Tree...

Come one, come all! Food, Drink, and Coastal Christmas – Anacortes has it all!

Come celebrate Anacortes’ 11th annual Bier on the Pier! Bier on the Pier takes place on October 7th and 8th and features local ciders, food trucks and live music - not to mention the beautiful views of the Guemes Channel and backdrop of downtown Anacortes.
Swedish Cyberknife Treatment...

The revolutionary treatment of Swedish CyberKnife provides better quality of life for majority of patients

There are a wide variety of treatments options available for men with prostate cancer. One of the most technologically advanced treatment options in the Pacific Northwest is Stereotactic Body Radiation Therapy using the CyberKnife platform at Swedish Medical Center.
Coinbase to pay $100M in settlement with New York regulators