May 13, 2021

BitMEX executives accused of violating US laws

BitMEX executives accused of violating US laws

Commodity Futures Trading Commission announces civil action filed with Southern District Court New York City with the indictment of five legal entities and three individuals who operate the BitMEX trading platform.

Regulators accuse BitMEX owners ofoperating a trading platform without proper registration and colluding to violate the Bank Secrecy Law by willfully refusing to establish, implement and maintain adequate anti-money laundering (“AML”, KYC) measures.

Among the defendants are the owners of the company Arthur Hayes,Ben Delo and Samuel Reed, who operate the BitMEX platform through a variety of legal entities, including HDR Global Trading Limited, 100x Holding Limited, ABS Global Trading Limited, Shine Effort Inc Limited, and HDR Global Services (Bermuda) Limited (BitMEX).

According to the allegations, the BitMEX platform receivedover $ 11 billion in BTC deposits and earned over $ 1 billion in commissions while conducting important aspects of its business from the US and accepting orders and funds from US customers.

In its legal action against the CFTC defendantsseeks seizure of illegal proceeds, fines, restitution in favor of clients, permanent bans on registration and trade, and a permanent ban on future violations of the Commodity Exchange Act (CEA). In addition, all founders of the exchange could face up to five years in prison.

Samuel Reed was arrested in Massachusetts on Thursday and will face a federal judge. The rest of the accused remain at large for now.

The market reacted to the negative news with a sharp drop in the MTC price to $ 10,500.

Exchange executives issued a message indicating that they would challenge the SEC's decision and that all client funds are safe.

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