Cryptocurrency exchange Bitmex acknowledges violating the Bank Secrecy Act (BSA) and failing to maintain AML compliance. 

The Bank Secrecy Act was violated by HDR Global Trading Ltd., better known as Bitcoin Mercantile Exchange or Bitmex, when it pleaded guilty to willfully failing to design, implement, and maintain an appropriate anti-money laundering (AML) program. This was announced by the U.S. Department of Justice (DOJ) on Wednesday.

Bitmex's founders admitted in federal court that the company lacked a strong anti-money laundering (AML) policy. The admission, according to U.S. Attorney Damian Williams, created a significant risk to the financial system's confidence by enabling the Bitcoin platform to be utilized as a vehicle for large-scale money laundering and sanctions evasion operations.

Established in 2014 by Arthur Hayes, Benjamin Delo, and Samuel Reed, Bitmex was a major U.S.-based cryptocurrency exchange and derivatives trading platform that had to register with the Commodity Futures Trading Commission (CFTC) and keep up an AML program. The Justice Department emphasized that it ignored crucial "know your customer" (KYC) procedures and simply needed an email address to gain access. 

This plea comes after a prior 2021 lawsuit against the exchange for similar behavior. In settlements with US regulators that year, Bitmex committed to paying $100 million. Three founders each agreed to pay a $10 million fine after entering a guilty plea to US charges in 2022.

Bitmex released a statement on Wednesday in reaction to the DOJ's announcement that HDR Global Trading Ltd. would face charges for violating the Bank Secrecy Act. The statement noted that Bitmex's operations remain unaffected by the indictment.