The U.S. Department of justice and the IRS are investigating money laundering and (illegal) tax avoidance in the world's largest crypto exchange, U.S. media reported on Thursday. At present, law enforcement agencies have obtained some information from people who know about money security business. Although both organizations have jurisdiction to investigate potential violations, not all investigations will become formal charges.
Affected by the relevant news, bitcoin's short-term decline touched the US $47000 level, while the safe currency's short-term decline exceeded 10%.
(BNB / USD five minute chart, source: tradingview)
According to people familiar with the matter, prosecutors from the bank integrity unit of the U.S. Department of justice are specifically involved in the currency security investigation, which is mainly responsible for investigating complex cases of financial institutions, while investigators from the Seattle district attorney are also involved. The IRS investigation has been going on for several months, and their questions to people familiar with the matter show that the customers and employees of coin an are the subjects of the investigation.
About two months ago, it was also reported that the US Commodity Futures Trading Commission (CFTC) investigated whether currency security allowed us investors to illegally trade derivatives related to digital certificates. According to relevant laws, Americans can not buy such derivatives that are not registered with CFTC.
Coin an's response: things are not as bad as the headlines
In response to media reports, the exchange said that the company attaches great importance to legal obligations and cooperates with regulatory and law enforcement departments in a collaborative way. The company has been striving to build a strong compliance program that combines anti money laundering principles with the tools used by financial institutions to detect and deal with suspicious activities. At the same time, coin an has a good record in assisting law enforcement agencies around the world, including the United States.
(source: social media)
US users involved in the case
For the investigation of relevant departments, there is not only a lack of regulatory framework for cryptocurrency exchange, but also the operation mode of the whole industry greatly increases the difficulty of investigation. Take coin an as an example. Although the company has an office in Singapore and has set up in the Caymans, it has made it clear that there is no so-called headquarters.
At the same time, in terms of us regulation, any investigation into currency security should at least prove that the company provides services to US citizens. In this regard, currency security has always stressed strict compliance with U.S. laws, prohibiting Americans from using the website, and using advanced technology to analyze signs of money laundering and other illegal acts. Last year, the platform also publicly said that if Americans were found trading on the platform, it would take measures such as titles.
According to people familiar with the matter, some US customers were suggested to use a virtual proxy network to disguise their location before coin on us went online. A coin Security spokesman responded that the company has never encouraged us citizens to use this method to circumvent company rules. In January, Zhao CHANGPENG, founder of coin an, also said on social media that even if Americans use this method, coin an's system will prohibit them from connecting.
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Link to the original text:Financial Association