January 6, 2021
A NEW YEAR’S TALE OF CAUTION – OFAC Settlement Highlights Risks for Those Dealing in Digital Currencies
What Happened: OFAC settled with BitGo, Inc. for $98,830, resolving 183 apparent violations of multiple US sanctions programs for processing digital currency transactions on behalf of individuals located in sanctioned jurisdictions.
The Bottom Line: Companies providing digital currency services should be aware of sanctions risks and should implement compliance procedures sufficient to ensure that they do not deal with blocked persons or otherwise engage in transactions prohibited by sanctions. This action also cautions financial institutions subject to US jurisdiction of the sanctions risks associated with interacting with digital or crypto currency providers.
The Full Story: Amid the rise of digital currency services, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) published a cautionary tale on December 30, 2020, discussing a recent settlement with BitGo, Inc. (BitGo), a California-based technology company that facilitates digital currency transactions and provides non-custodial digital wallet management services. BitGo settled for $98,830 after the company faced, at a maximum, a $53 million civil penalty for 183 apparent violations of multiple US sanctions programs.
