March 29, 2024

BitMEX executives accused of violating US laws

BitMEX executives accused of violating US laws

The Commodity Futures Trading Commission announced the filing of a civil lawsuit in the Southern District CourtNew York with charges against five 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 accused – owners of the company ArthurHayes, Ben Delo and Samuel Reed, who operate the BitMEX platform through multiple 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 lawsuit against the defendants, the CFTCseeks disgorgement of ill-gotten gains, fines, restitution to clients, permanent registration and trading injunctions, and a permanent injunction against future violations of the Commodity Exchange Act (CEA). In addition, all founders of the exchange may 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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