- Arthur Hayes has been sentenced to serve six months on house arrest.
- Hayes has already paid a $10 million penalty in connection with a settlement with the US Commodity Futures Trading Commission.
- Hayes is the first of three BitMEX co-founders to be sentenced for violation of the Bank Secrecy Act.
Arthur Hayes, the co-founder and former CEO of cryptocurrency derivatives exchange BitMEX, has been sentenced to serve six months of house arrest for violating US law by not establishing a compliant anti-money laundering (AML) program.
This was announced after he was sentenced at a hearing in a federal court in Manhattan on Friday. In addition to his house arrest, he also has to serve two years of probation. Hayes has already paid a $10 million penalty in connection with a settlement with the US Commodity Futures Trading Commission.
Prosecutors stated that Hayes made himself rich by closely monitoring, studying, and studiously ignoring US AML laws and regulations meant to stop financial institutions from moving funds for criminals and terrorists.
Prosecutors also highlighted that Seychelles incorporated BitMEX and made him around $100 million. Some of the business was with US customers, and BitMEX failed to enact AML programs that comply with US law.
Haye’s defense team, on the other hand, stated that Hayes received very little guidance from regulators on how US law applied to offshore crypto businesses. His team also brought up that Hayes is already a crypto pioneer and has been involved with big industry names like Deutsche Bank AG and Citigroup.
Hayes is the first of three BitMEX co-founders to be sentenced for violating the Bank Secrecy Act. The two other co-founders, Benjamin Delo and Samuel Reed, have already pleaded guilty. Hayes has stated that he deeply regrets being involved in the criminal activity.