Coinbase’s UK Unit Slapped With $4.5M Fine for Violating High-Risk Customer Ban

CryptoPotato · 2024-07-25T15:23:02.000Z

Coinbase’s UK unit – CB Payments Limited (CBPL) – was fined $4.5 million by the UK financial regulatory agency, the Financial Conduct Authority (FCA), for repeatedly violating a requirement that barred the firm from providing services to high-risk customers. While CBPL itself does not handle crypto transactions for customers, it serves as a “gateway” for trading through other entities within the Coinbase Group. However, CBPL is not currently registered to conduct crypto activities in the UK. Breaching Crypto Trading Restrictions In October 2020, following significant engagement with the FCA over concerns regarding the effectiveness of CBPL’s financial crime control framework, the firm entered into a voluntary requirement (the VREQ). It restricted CBPL from onboarding new high-risk customers until the framework issues were resolved. Despite these restrictions, the financial regulator accused CBPL of onboarding as well as providing e-money services to 13,416 high-risk customers, according to the FCA’s official press release. Around 31% of these customers deposited approximately $25 million. This amount was then used for withdrawals and to execute multiple crypto transactions through other Coinbase Group entities, totaling approximately $226 million. The FCA reported that the breaches were a result of CBPL’s insufficient skill, care, and diligence in developing, testing, and overseeing controls designed to enforce the VREQ. This also included the failure to account for various customer onboarding scenarios. The agency further highlighted that flaws in the initial monitoring allowed significant breaches to go unnoticed for nearly two years. Weakness in CBPL’s controls Commenting on the latest enforcement action against the Coinbase Group entity, Therese Chambers, joint executive Director of Enforcement and Market Oversight at the FCA, said, “The money laundering risks associated with crypto are obvious and firms must take them seriously. Firms like CBPL that enable crypto trading need to have strong financial crime controls. CBPL’s controls had significant weaknesses and the FCA told it so, which is why the requirements were needed. CPBL, however, repeatedly breached those requirements.” Chambers also warned about the increased risk that criminals could leverage the platform to launder the proceeds of crime. Meanwhile, this enforcement action was carried out under the Electronic Money Regulations 2011, marking the FCA’s first use of these powers for enforcement. The post Coinbase’s UK Unit Slapped With $4.5M Fine for Violating High-Risk Customer Ban appeared first on CryptoPotato.

Coinbase 的英國子公司 CB Payments Limited (CBPL) 因屢次違反禁止該公司向高風險客戶提供服務的規定，被英國金融監管機構金融行爲監管局 (FCA) 罰款 450 萬美元。
雖然 CBPL 本身並不爲客戶處理加密貨幣交易，但它充當了通過 Coinbase 集團內其他實體進行交易的“網關”。不過，CBPL 目前尚未在英國註冊開展加密貨幣活動。
違反加密貨幣交易限制
2020 年 10 月，在與 FCA 就 CBPL 金融犯罪控制框架有效性的擔憂進行了大量接觸後，該公司簽署了一項自願要求 (VREQ)。該要求限制 CBPL 接納新的高風險客戶，直到框架問題得到解決。
根據英國金融行爲監管局（FCA）的官方新聞稿，儘管存在這些限制，但該金融監管機構仍指責 CBPL 爲 13,416 名高風險客戶提供入職和電子貨幣服務。
其中約 31% 的客戶存入了約 2500 萬美元。這筆錢隨後被用於提款並通過 Coinbase Group 的其他實體執行多筆加密貨幣交易，總額約爲 2.26 億美元。
FCA 報告稱，違規行爲是由於 CBPL 在制定、測試和監督旨在執行 VREQ 的控制措施方面缺乏技能、謹慎和勤勉所致。這還包括未能考慮到各種客戶入職場景。
該機構進一步強調，最初監控中的缺陷導致嚴重違規行爲近兩年內未被發現。
CBPL 控制薄弱
FCA 執法和市場監督聯合執行董事 Therese Chambers 在評論針對 Coinbase Group 實體的最新執法行動時表示，
“與加密貨幣相關的洗錢風險顯而易見，公司必須認真對待。像 CBPL 這樣支持加密貨幣交易的公司需要有強大的金融犯罪控制。CBPL 的控制存在重大缺陷，FCA 也指出了這一點，這就是爲什麼需要這些要求。然而，CPBL 一再違反這些要求。”
錢伯斯還警告稱，犯罪分子利用該平臺洗錢的風險越來越大。
同時，此次執法行動是根據2011年《電子貨幣條例》進行的，標誌着FCA首次使用該權力進行執法。
Coinbase 英國子公司因違反高風險客戶禁令被處以 450 萬美元罰款一文最先出現在 CryptoPotato 上。

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