CoinList has reached a settlement over allegations from U.S. regulators that it has violated sanctions

This article is brief:

• CoinList has reached a settlement with OFAC regarding potential violations related to 989 transactions processed by users in Crimea.

• The U.S. OFAC determined that CoinList’s conduct was not serious and was not voluntarily self-disclosed.

• Despite maintaining sanctions compliance measures, CoinList’s program failed to identify users who lied about their place of residence.

CoinList has reached a settlement with the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) regarding alleged irregularities in user transactions in Crimea.

“The California-based virtual currency exchange has agreed to pay $1,207,830 to address its potential civil liability,” the statement said. ”

CoinList solves regulatory issues for US authorities

According to a recent statement, the apparent violations occurred between April 2020 and May 2022. Allegedly, CoinList processed 989 transactions for users claiming to reside in Crimea, in clear violation of OFAC sanctions against Russia and Ukraine.

Despite maintaining sanctions compliance measures, including customer screening and transaction monitoring, the CoinList program failed to identify users who falsely reported that they reside in a non-embargoed country when providing an address within Crimea.

The statement explains that this oversight led to the opening of 89 accounts for users who designated Russia as their country of residence but provided an address in Crimea.

The settlement amount of $1,207,830 takes into account a variety of factors. This includes OFAC’s determination that the violation is not serious.

CoinList Faces Escalating Penalties Amid Exchange Challenge

OFAC noted that the statutory maximum fine is much higher at $327,306,583. In addition, OFAC reportedly considered other factors, such as CoinList’s failure to exercise due care in complying with the sanctions.

In addition, it claims to be aware of potential violations and undermines the policy objectives of the relevant sanctions regulations for Ukraine and Russia.

However, it acknowledged that CoinList cooperated with the investigation, had not been penalized before, and that the apparent violations were only a small fraction of the total trading volume.

CoinList has also implemented significant remedial measures, strengthening its screening protocol and compliance staff.

It is reported that the exchange also agreed to suspend the settlement amount of $300,000. However, this is to ensure compliance and as part of the settlement.

In addition, CoinList committed $300,000 to strengthen sanctions compliance controls.