On May 01, 2023, The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced a settlement with Poloniex for apparent violations of sanctions against Crimea, Cuba, Iran, Sudan, and Syria. Poloniex agreed to remit $7,591,630 to settle its potential civil liability. Between January 2014 and November 2019, the Poloniex trading platform allowed customers apparently located in sanctioned jurisdictions to engage in online digital asset-related transactions—consisting of trades, deposits, and withdrawals.
OFAC determined the following to be mitigating factors:
Ø Freezing users’ accounts until KYC verification was completed; o Implementing an automated review and verification tool for identity documents
Ø Implementing a protocol that prevented users from activating an account if the profile information matched a sanctioned country
Ø Implementing geolocation restrictions with respect to Syria, Iran, Cuba, Sudan, and North Korea
Ø Closing any accounts that listed “Crimea” in the profile information, and identification and blocking of IP ranges associated with certain internet service providers operating in Crimea
Ø Creating a “Crimea IP blacklist” and “Crimean city/region keywords list” against which all account information was screened
Ø Enhancing its training program and hiring additional experienced compliance personnel.
