The years 2023 and 2024 continue to be difficult for managers of major cryptocurrency companies. Finally, Artur Schaback, one of the co-founders of cryptocurrency issuer Paxful, pleaded guilty to not paying enough attention to anti-money laundering rules. Schaback faces a maximum prison sentence of up to 5 years…
Changpeng Zhao, Sam Bankman-Fried, Do Kwon... These executives of cryptocurrency-focused companies, who are currently in prison and are also known to millions of people, are of course the tip of the iceberg... The world may only see three of the dozens of executives in prison, but regulators do not let go of the crypto world. .
Finally, Artur Schaback, one of the founders of Paxful company, known for cryptocurrencies such as USDP and PAX Gold, is facing a prison sentence…
Like CZ, he agreed
According to the statement made by the US Department of Justice, Artur Schaback accepted the accusations that he did not adequately implement money laundering measures. As you may remember, this was one of the important accusations made against former Binance CEO CZ. CZ also accepted this "mistake" and went to prison to serve his 4-month sentence. CZ is expected to be released from prison in August.
The US Department of Justice claims that Paxful, which Schaback managed between 2015 and 2019, did not sufficiently comply with KYC rules regarding person-to-person money transfer (P2P). The manager also appears to have made some statements that the platform does not require KYC.
“It started to be used for money laundering.”
The ministry's statement also stated that Schaback knowingly and willingly provided false information to third parties and deceived institutions about anti-money laundering rules:
“This situation has caused Paxful to become one of the most used platforms for money laundering.”
Schaback left his position as operations manager in February 2022 due to disagreements with Ray Youssef, Paxful's famous and former CEO.
Although Paxful continued to issue tokens in April 2023, it closed its marketplace but later reactivated it with high-level security measures.
Paxful was also widely used in Nigeria, where there was a huge demand for P2P.
