Kraken To Pay $362k To Settle Iran Sanction Violations
- The United States Office of Foreign Assets Control (OFAC) has imposed a fine of around $362,000 on major crypto exchange Kraken for the apparant violation of sanctions that were imposed against Iranian people.
- Kraken has also agreed to “invest” $100,000 in some additional sanctions compliance controls along with training its staff and implementing technical controls to assist in sanctions detection.
- The OFAC has reasons to believe that between October 14, 2015 and June 29, 2019, the exchange had processed 826 transactions, totaling approximately $1,680,577.10.
Major crypto exchange Kraken has finally come out of regulatory troubles related to violations of sanctions imposed on the citizens of Iran. The United States Office of Foreign Assets Control (OFAC) remains undeterred in its decision to fine crypto exchanges for violations of sanctions imposed around the globe, and now the crypto exchange ranked as the third biggest exchange by trading volume, is the one to pay.
A fine of around $362,000 has been imposed on the prominent American crypto exchange Kraken by the Treasury Department’s Office of Foreign Assets Control (OFAC) for the apparant violation of US sanctions imposed against the people of Iran. Additionally, the exchange has agreed to “to settle its potential civil liability,” which have tagged along with possible violations of the Iranian Transactions and Sanctions Regulations.
Moreover, Kraken has also agreed to “invest” $100,000 in some additional sanctions compliance controls along with training its staff and implementing technical controls to assist in sanctions detection.
“Due to Kraken’s failure to timely implement appropriate geolocation tools, including an automated internet protocol (IP) address blocking system, Kraken exported services to users who appeared to be in Iran when they engaged in virtual currency transactions on Kraken’s platform,” stated the OFAC.
The financial intelligence and enforcement agency of the US further added that “the settlement amount reflects OFAC’s determination that Kraken’s apparent violations were non-egregious and voluntarily self-disclosed.”
As per the agency, Kraken had placed a satisfactory anti-money laundering and sanctions compliance program. This included screening customers at onboarding and daily thereafter, as well as review of IP address information generated at the time of onboarding to prevent users in sanctioned jurisdictions from opening accounts.
But, the OFAC has reasons to believe that between October 14, 2015 and June 29, 2019, the exchange had processed 826 transactions, totaling approximately $1,680,577.10, for people located in Iran, which was against the sactions imposed.
According to reports, the investigation into Kraken’s potential sanction violations began in July and this made the Delware-based entity as the largest crypto exchange to ever face OFAC enforcement action.
Kraken Eyes Expansion After CEO Quits
As per earlier reports, Kraken’s former CEO Jesse Powell, who served as the chief executive for over 11 years at the firm, decided to call it quits earlier this year and as a result, was succeeded by chief operating officer Dave Ripley, who has worked with the firm since 2016. Ripley says that he has huge shoes to fill and also added that the exchange aims to navigate around regulatory roadblocks and work its way into the mainstream crypto adoption. The firm has plans to shift its focus to increase its team and expand its services around the globe in order to increase its client base.