Cryptocurrency

Bitmex’s Hayes Avoids Imprisonment, Gets 2 years Probation, 6 Months House Arrest For Violating the US Bank Secrecy Act

Bitmex’s Hayes Avoids Imprisonment, Gets 2 years Probation, 6 Months House Arrest For Violating the US Bank Secrecy Act
Written by Arindam

Summary:

  • Bitmex founder, Arthur Hayes, will not spend a single day in jail for violating the U.S. Bank Secrecy Act.
  • Mr. Hayes has been sentenced to two years probation with the first six months in home confinement.
  • Arthur Hayes also agreed to forfeit $10 million in a plea deal.
  • However, the assistant U.S. attorney for the Southern District of New York has warned that his light sentencing and fine could send the wrong message to crypto exchanges facing possible similar charges.

The Co-founder and former CEO of Bitmex, Arthur Hayes, will not spend a day in jail for violating the U.S. Bank Secrecy Act.

According to a report by Bloomberg, Mr. Hayes has been sentenced by a Federal Judge to two years of probation with the first six months of his sentence in home confinement. As earlier mentioned, Mr. Hayes had been charged with violating the U.S. Bank Secrecy Act and failing to provide anti-money laundering safeguards such as verifying the identities of Bitmex users.

During the sentencing, Hayes took full responsibility for his actions adding that he regretted that he had played a part in breaking the law. He said:

I deeply regret that I had a part in this criminal activity. My best years are ahead of me. … I am ready to turn the page and start again. I ask that you allow me to return home, deeply remorseful and able to start the next chapter of my life.

Hayes, who has been a resident of Singapore, will further be allowed 30 days to decide where he will serve his home detention within the United States. Hayes has a home in Miami, but his lawyer suggested that he has no community in Florida and might decide on serving his home detention elsewhere.

Judge John Koeltl of the US Southern District Court in New York further agreed to allow Arthur Hayes to travel internationally after serving the initial six months. All he has to do is a check in with his probation officer as necessary via video call from his home in Asia.

As part of his plea deal, Arthur Hayes will also forfeit $10 million as a fine for his offense.

Arthur Hayes Light Sentencing Could Send the Wrong Message

However, Assistant U.S. Attorney of the Southern District of New York, Samuel Raymond, has warned that Hayes’ light sentencing and $10 million fine might send the wrong message to crypto exchanges. He said:

This is a very serious offense.

There were real consequences. When individuals like Mr. Hayes operate platforms without anti-money-laundering programs or know-your-customer programs, they become a magnet for people to launder money.

[Allowing Hayes to stay out of prison] would send a message to him that the cost of doing business is merely a fine, and he could continue to violate the law for huge amounts and pay any fine.

This case is being closely watched by cryptocurrency exchanges and other companies around the world.

[Feature image courtesy of Bloomberg]

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Arindam

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