Cryptocurrency exchange Coinbase will pay $50 million to New York's Department of Financial Services (NYDFS) for failing to conduct sufficient background checks, the company wrote in a blog post.
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The US-based trading platform has also committed to $50 million in compliance program investments over the next two years. The exchange said:
"We view this resolution as a critical step in our commitment to continuous improvement, our engagement with key regulators, and our push for greater compliance in the crypto space – for ourselves and others."
The penalty is the result of NYDFS's 2018-2019 compliance investigation. According to reports, Coinbase failed to conduct robust "know your customer" checks. Coinbase claims it took NYDFS's concerns "seriously and have taken substantial measures to address these historical shortcomings."
The reports also say that Coinbase was even ordered to hire multiple independent consultants and monitors to oversee its compliance during NYDFS's investigation.
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