BitMEX Executive Pleads Guilty To Violation Of Money Laundering Laws

  • Gregory Dwyer, a former head of business development at BitMEX, has pled guilty to violating anti-money laundering laws and the Bank Secrecy Act during his time at the exchange
  • He was one of the first employees at the derivatives exchange and is now facing a fine of $150,000 for the profits he made from illicit means

The United States Attorney for the Southern District of New York, Damian Williams, recently announced that a high-ranking employee at crypto derivatives exchange platform BitMEX has pleaded guilty to violating regulations related to anti-money laundering.

On Monday, Gregory Dwyer, a former head of business development at BitMEX, pleaded guilty before U.S. District Judge John G. Koeltl to violating the Bank Secrecy Act for “failing to establish, implement, and maintain an anti-money laundering program” at the Seychelles-incorporated exchange.

One of BitMEX’s early employees, Dwyer, was allegedly involved in the company’s violation of U.S. laws against money laundering.

Prosecutors claim that despite BitMEX’s announcement in 2015 that it was leaving the American market, little or no effort was made to stop Americans from signing up and using the exchange. Although thousands of U.S.-based clients were supposed to be blocked, they were using the platform because the controls in place were only a “facade,” according to the prosecution. 

In addition to his other responsibilities at BitMEX, Dwyer collected and circulated data suggesting that the company’s users included traders and that it earned revenue from the United States.

As BitMEX lacked know-your-customer (KYC) and anti-money-laundering (AML) measures, the prosecution argued that it, in fact, served as a platform for money laundering and sanctions evasion.

“Today’s plea reflects that employees with management authority at cryptocurrency exchanges, no less than the founders of such exchanges, cannot willfully disregard their obligations under the Bank Secrecy Act.”

Williams stated.

Two years ago, BitMEX was hit with civil and criminal charges by the Commodity Futures Trading Commission (CFTC), Department of Justice (DOJ), and Financial Crimes Enforcement Network (FinCEN) for allowing Americans to trade cryptocurrency futures on its platform without registering in the nation and using poor know-your-customer (KYC) standards. Although the agencies ultimately reached a $100 million settlement with BitMEX last summer, the accusations led to a shift in the exchange’s management.

Dwyer, a 39-year-old Australian-Bermudese citizen, was one of four major BitMEX executives charged in New York. The three co-founders, Arthur Hayes, Benjamin Delo, and Samuel Reed, had previously been proven guilty by judgments secured by the U.S. Attorney. Delo received a 30-month probationary period, while Hayes received a house arrest sentence in May. Dwyer, who had entered a not guilty plea, has agreed to shell up $150,000 in fines. The maximum penalty for the offense is five years in prison.

Parth Dubey Verified

A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.

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