On 5th May, Southern District court of New York sent directives to the three co-founders of BitMEX crypto derivatives exchange, to pay a total of $30 million civil monetary penalty. As per the Commodity Futures Trading Commission (CFTC), Hayes, Benjamin Delo, and Samuel Reed were each fined $10 million as leave payments. At the end of a legal battle on May 5 CFTC claimed they violated aspects of the Commodity Exchange Act and CFTC regulations from November 2014 to October 2020.
On Oct. 1, 2020, the CFTC filed a legal action against BitMEX and its co-founders. The CFTC alleged that co-founders of BitMEX were operating the BitMEX platform while conducting remarkable aspects of BitMEX operation from the United States, and illegally taking orders and funds from U.S. customers to trade cryptocurrencies,” which includes Ether (ETH), Bitcoin (BTC) and Litecoin (LTC) derivatives.
About illegal activity CFTC said BITMEX is running a Designated Contract Market or a Swap Execution Facility without having approval paper. They were also accused of operating as a Futures Commission Merchant without CFTC registration, failing to execute a Customer Information Program and Know-Your-Customer processes, and failing to develop an appropriate Anti-Money Laundering programme.
In a separate statement on May 5, CFTC Commissioner Carline D. Pham stated that her Commission is committed to pursue “wrongdoers with an unfair advantage” who operate in violation of the law.
“By enforcing individual accountability for registration, market conduct, and anti-money laundering rules—fundamental aspects of the U.S. regulatory framework—the CFTC is ensuring that BitMEX’s management is held responsible after last year’s $100 million dollar settlement with corporate defendants.”
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Ex-CEO of BitMEX Authur Hayes requests no imprisonment and travel liberty
