The U.S. Department of Justice (DOJ) and the U.S. Securities and Exchange Commission (SEC) have taken major actions against Bit Mining Ltd., a cryptocurrency mining company. Previously known as 500.com, the firm shifted from operating as a Chinese online sports lottery provider to focusing on blockchain technology, cryptocurrency mining, mining pools, and data centers.
Bit Mining has agreed to a deferred prosecution agreement (DPA) with the DOJ, accepting a $10 million criminal penalty for violating the Foreign Corrupt Practices Act (FCPA). In parallel, the SEC imposed a $4 million civil penalty for related violations. The enforcement actions center on a bribery scheme from 2017 to 2019, where Bit Mining and its executives allegedly funneled $2.5 million in illicit payments, disguised as consulting fees, entertainment, and travel, to Japanese officials to secure a casino and resort development contract.
Former CEO Zhengming Pan has been indicted on charges of conspiracy and falsifying records for allegedly directing the scheme and concealing bribes through sham agreements. U.S. Attorney Philip R. Sellinger said:
The illegal scheme started at the top, with the company’s CEO allegedly fully involved in directing the illicit payments and the subsequent efforts to conceal them.
Despite the bribery attempts, Bit Mining failed to win the Japanese contract. As part of the DPA, the company will strengthen compliance measures, cooperate with authorities, and conduct anti-corruption training. The FBI’s Assistant Director Chad Yarbrough emphasized the impact of such cases, stating:
This type of criminal activity undermines the integrity of business practices.
The case, investigated with assistance from Japanese authorities, highlights global efforts to combat corporate corruption.