Coinbase will spend about $100 million to improve the exchange’s regulatory compliance.
The company will pay a $50 million fine to the New York State Department of Financial Services (NYDFS) for violating New York’s financial services and banking laws, and will invest $50 million to fix its regulatory compliance program.
According to the regulator, the exchange had many “deficiencies” related to anti-money laundering (AML) requirements. NYDFS reported problems with Coinbase regarding user registration and transaction monitoring.
The exchange allowed customers to open accounts without conducting sufficient background checks, a violation of anti-money laundering requirements under the state’s licensing regime.
The company received 100,000 warnings as part of these violations.