The Treasury Department announced on Monday that Kraken, one of America's largest cripto exchanges, has settled with the government and agreed to pay more than $360,000 for violating America's sanctions laws related to Iran.
Between October 2015 and June 2019, the Delaware-based company failed to prevent more than 820 individuals from Iran from conducting more than 1.6 million transactions on its platform, according to the Office of Foreign Assets Control OFAC OFAC, which found Kraken's conduct non-egregious and voluntarily self-disclosing, reducing the settlement it paid.
The agreement will have to spend $100,000 on improving its sanctions compliance system by instituting an automated internet protocol address blockade that would prevent users from accessing Kraken for transactions in the future.
Kraken applied its geolocation controls only at the time of onboarding and not with respect to subsequent transactional activity despite the fact that transactions appear to have been conducted from Iran, OFAC said.
The agency praised Kraken for its remedial changes like integrating geolocation blocking into its platform to prohibit Iranians from using Kraken, improving sanctions monitoring throughBlockchain analytics, and appointing a dedicated sanctions expert to staff, and blocking accounts in Crimea, Donetsk and Luhansk in Ukraine.
In 2021, Kraken was fined $1.25 million for not registering as a futures commission merchant with the Commodity Futures Trading Commission and selling margined retail commodities illegally.