BitMEX co-founder sentenced to house arrest for money laundering

The co-founder and former chief executive of cryptocurrency exchange BitMEX was sentenced to six months of house arrest after pleading guilty to violating the United States Bank Secrecy Act, prosecutors said.

Arthur Hayes, 36, will also pay a $10 million fine and serve two years of probation after his house arrest for failing to establish an anti-money laundering program at BitMEX, which he founded with Benjamin Delo and Samuel Reed in 2014. Hayes was sentenced in federal court in Manhattan on Friday (20).

“By creating a cryptocurrency platform that has earned him millions of dollars, Arthur Hayes deliberately defied US law that requires companies to do their part to help prevent crime and corruption,” said Damian Williams, Manhattan Federal Prosecutor. , in a statement.

Prosecutors sought a “significant” prison sentence, saying a $10 million fine was not enough to stop similar behavior from other cryptocurrency companies. Hayes’ lawyers asked for parole, without house arrest.

A spokesperson for Hayes declined to comment. Delo and Reed have pleaded guilty and are awaiting sentencing. The three were indicted in 2020 for failing to implement a “know your customer” requirement as required by federal law.

Prosecutors said BitMEX was “actually a money laundering platform” and Hayes did nothing after learning in 2018 of allegations that BitMEX was being used to launder the proceeds of a cryptocurrency hack.

Last year, BitMEX agreed to pay up to $100 million to settle lawsuits for illegally accepting customer funds to trade cryptocurrencies without being registered and failing to perform customer due diligence.