In July 2024, the FCA fined CB Payments Limited (CBPL), part of the Coinbase Group, £3.5 million for failing to comply with anti-money laundering (AML) regulations between 2020 and 2023. The company, which provides e-money services, onboarded 13,416 high-risk customers and permitted 12,912 prohibited deposits totaling $24.9 million. Many of these funds were later used for cryptoasset transactions. The breaches occurred despite FCA-imposed voluntary requirements (VREQ) aimed at preventing financial crime.
The FCA found significant deficiencies in CBPL’s controls, including the design, testing, and monitoring of systems meant to ensure compliance with the VREQ. Failures in customer onboarding processes allowed high-risk customers to access services, facilitating transactions totaling $226 million. Suspicious Activity Reports (SARs) were filed for 62 customers, many of which involved significant transactions and potential money laundering.
This enforcement highlights the importance of robust AML frameworks, especially in firms dealing with cryptoassets, as they present heightened risks for financial crime. The FCA acknowledged CBPL’s efforts to enhance its financial crime controls but emphasized that these steps should have been taken much earlier.
For more details, refer to the FCA’s final notice.
About Michael Rasmussen
Michael Rasmussen is the founder of United Atlantic Legal Services. He is a licensed attorney in Florida and registered solicitor in the United Kingdom. Michael has acted as General Counsel and Chief Compliance Officer to several investment advisers, including private fund managers, responsible for the management of billions of dollars in client assets.
Michael is also the founder of FinProLaw, an online learning platform where Michael has created courses designed for investment adviser compliance professionals. These courses include:
- Investment Adviser Compliance Essential for Chief Compliance Officers
- Foundations of Investment Adviser Compliance
- What is a “Security”?
- Investment Adviser Marketing Rule
- Regulation A – Exemption from Registration
- Regulation Crowdfunding – Exemption from Registration
- Regulation D – Exemption from Registration
Michael can also be found on LinkedIn.
Investment adviser firms who are also clients of United Atlantic Legal Services can receive many of these courses at a significantly reduced fee or, in some cases, at no expense. Contact us today or visit the FinProLaw to learn more.