According to TechFlow, Artur Schaback, co-founder and former technical director of Paxful, admitted to failing to maintain an effective anti-money laundering (AML) program and faces up to five years in prison. The U.S. Department of Justice said Schaback will be sentenced on November 4 and has resigned from the Paxful board of directors.

Under the plea agreement, Schaback will pay a $5 million fine, payable in three installments. The Department of Justice stated that Schaback failed to establish effective AML and KYC procedures within 90 days of launching the business, making Paxful a tool for money laundering and other criminal activities.