Poloniex Agrees to Pay $7.6M in Settlement for Sanction Violations


As per the recent reports, the American Treasury Department’s Office of Foreign Asset Control (OFAC) confirmed a $7.6 million settlement with bitcoin marketplace Poloniex for more than 65,000 suspected breaches of multiple regulatory operations.

Poloniex to Pay $7.6M

OFAC stated in a May 1 statement that the $7.6 million will be employed to settle Poloniex’s civil lawsuit for suspected violations targeting Crimea, Cuba, Iran, Sudan, and Syria. 

From January 2014 to November 2019, Poloniex permitted users in sanctioned areas to undertake over fifteen million dollars in digital asset trades, deposits and withdrawals, as reported by the federal agency.

A History of Sanction Violations

The statement reads that “although Poloniex made efforts to identify and restrict accounts with a nexus to Iran, Cuba, Sudan, Crimea, and Syria pursuant to its compliance program, certain customers apparently located in these jurisdictions continued to use Poloniex’s platform to engage in online digital asset-related transactions.”

OFAC claims that Poloniex’s alleged breaches resulted from its failure to subsequently screen individuals who registered at the exchange between the time of its opening in January 2014 and the establishment of a sanctions compliance programme in May 2015. 

Poloniex’s Changing Ownership

Notably, Circle purchased Poloniex in 2018, after which the firm’s compliance mechanisms “further improved,” according to OFAC’s inquiry, especially by shutting accounts with IP addresses that operated in Crimea. 

In 2019, a group of investors led by Tron creator Justin Sun bought the company from Circle. He was a part of an investing group that bought the crypto exchange in 2019, and he also acted as an advisor for Huobi. 

Strong Exchange Score

Prominent Huobi has dismissed reports that it may merge operations with the Poloniex platform as “categorically untrue,” TheCoinRise reported earlier. 

It is important to look at the fact that in a July CoinMarketCap assessment of numerous parameters, like Web traffic, the platform was one of the top rated exchanges with a very strong exchange score last year.

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