March 9, 2021

BitPay to Pay $500K to Settle OFAC Sanction Violation Charges

Crypto payments platform BitPay has settled with the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) on charges of over 2,000 apparent sanctions violations. BitPay will pay $507,375 on allegations it allowed individuals in sanctioned locations like Ukraine’s Crimea region, Cuba, North Korea, Sudan, Iran and Syria to transact with people in the U.S., in apparent violation of U.S. sanctions law.

According to OFAC, the company knew it facilitated transactions for individuals in sanctioned regions because it had location information and IP addresses. Under the charges, BitPay could have faced a maximum fine of over $600 million, but OFAC considered some mitigating factors, the enforcement notice said. These include that BitPay implemented compliance controls, employee training, launched an identification service, blocked IP addresses in sanctioned regions and took several other steps to prevent it from facilitating such transactions in future. BitPay cooperated with OFAC as the agency investigated the charges.

The sanctions notice warned that cryptocurrency companies must abide by OFAC regulations and monitor for possible sanctions risks. OFAC said that Companies that facilitate or engage in online commerce or process transactions using digital currency are responsible for ensuring that they do not engage in unauthorised transactions prohibited by OFAC sanctions, such as dealings with blocked persons or property or engaging in prohibited trade or investment-related transactions.

Learn more here.

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