OKX Operator Faces Over $504 Million In Penalties For Violating US Laws
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The company operating the OKX cryptocurrency exchange has agreed to pay more than $504 million in fines and fees after admitting to violations of United States anti-money laundering laws. Aux Cayes Fintech, which runs OKX, pleaded guilty to operating an unlicensed money transmitting business.
OKX is one of the largest cryptocurrency exchanges, handling billions of dollars in transactions each day. Despite having a policy that restricted access for users in the United States, the Department of Justice stated that OKX actively sought customers in the country.
OKX Failed To Follow Rules, Let Users Trade Without Proper Checks
Retail and institutional traders in the United States reportedly carried out transactions worth over one trillion dollars on the platform. These transactions generated hundreds of millions of dollars in fees and profits for the exchange.
Prosecutors said OKX failed to register as a money services business with FinCEN, which was required by law. For an extended period, the exchange allowed retail customers to create accounts, send and receive funds, and trade without completing identity verification.
Even after introducing a Know Your Customer (KYC) process, some employees reportedly guided users on how to provide false details to bypass verification.
Acting United States Attorney Matthew Podolsky stated that OKX knowingly ignored anti-money laundering laws for several years and failed to implement measures to prevent criminal activities on its platform. Authorities said the exchange processed over five billion dollars in suspicious transactions linked to illicit activities.
OKX, previously known as OKEx, is a cryptocurrency exchange based in Seychelles. It was founded by Star Xu, who also leads the company. Hong Fang serves as President, while Haider Rafique holds the position of Chief Marketing Officer. OKX is part of OK Group, which also owns the crypto exchange Okcoin.
OKX Expands Globally While Facing Legal Challenges
The platform allows investors to trade Bitcoin, Ethereum, and various other cryptocurrencies. It operates in multiple global markets, including Hong Kong, the United Arab Emirates, The Bahamas, and France. OKX has offices in Dubai, Turkey, Hong Kong, Silicon Valley, Singapore, and Australia.
OKX has formed partnerships with well-known brands and sports teams, such as Manchester City, McLaren, and the Australian Olympic Team.
The company has also been a sponsor of the Tribeca Film Festival and holds exclusive rights for non-fungible token (NFT) marketplaces and cryptocurrency exchanges at Tribeca events.
OKX faced penalties for breaking United States anti-money laundering laws. Officials said the exchange did not follow the rules. Even with its global work and partners, OKX let users trade without proper checks. Some workers even helped them. This case shows why following rules is important in cryptocurrency businesses worldwide.
