FinCEN brings first civil money penalty against peer-to-peer virtual currency exchanger for violatin
On 18 April 2019 the U.S. Financial Crimes Enforcement Network (FinCEN) announced that it has penalized Eric Powers for violating the Bank Secrecy Act (BSA). Powers failed to register as a money services business although he advertised his intent to purchase and sell bitcoin on the internet. He also had no written policies or procedures for ensuring BSA compliance, including no effective Anti-Money Laundering (AML) program. In addition, Powers did not report currency transactions or suspicious transactions. He conducted over 200 transactions yet did not file any Currency Transaction Reports (CTRs), likewise he failed to file Suspicious Activity Reports (SARs) although he performed numerous transactions on the darknet marketplace 'Silk Road’.
FinCEN has determined that Powers’ violations were willful and assess a $35,350 penalty. This is the first enforcement action against a peer-to-peer virtual currency exchanger by FinCEN, and the first time a virtual currency exchanger has been penalized for failure to file CTRs.