CoinList Reaches Settlement with US Regulators on Alleged Sanction Violations

CoinList has reached a settlement with the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) regarding potential violations related to transactions processed for users in Crimea.

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

CoinList Resolves Regulatory Concerns with US Authorities

According to a recent statement , the apparent violations occurred between April 2020 and May 2022. CoinList allegedly processed 989 transactions for users claiming residence in Crimea , apparently in violation of OFAC’s Russia/Ukraine sanctions.

Despite maintaining sanctions compliance measures, including customer screening and transaction monitoring CoinList procedures failed to identify users misrepresenting their residence in non-embargoed countries while providing addresses within Crimea.

This oversight resulted in 89 accounts being opened for users who specified “Russia” as their country of residence but provided addresses in Crimea.

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The settlement amount of $1,207,830 takes into account various factors, including OFAC’s determination that the violations were non-egregious.

CoinList Faces Escalating Penalties Amid Exchange Challenges

The OFAC noted the statutory maximum penalty was significantly higher at $327,306,583. However, the OFAC reportedly considered aggravating factors, such as CoinList’s failure to exercise due caution in sanctions compliance.

Additionally, knowledge of potential violations, and harm to the policy objectives of the Ukraine and Russia-Related Sanctions Regulations.

Mitigating factors included CoinList cooperation with the investigation, absence of previous penalties, and the small percentage of the total transactions represented by the apparent violations.

CoinList also implemented significant remedial measures , enhancing its screening protocols and compliance staff.

Furthermore, the exchange agreed to suspend $300,000 of the settlement amount. However, this was to ensure compliance and as part of the settlement.

Additionally, CoinList committed to investing $300,000 in enhanced sanctions compliance controls.

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