The crypto exchange Kraken has reached a settlement with the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury over its alleged violations of sanctions against Iran. The cryptocurrency exchange has agreed to pay $362,159 as part of a settlement of its possible legal liability and to put another $100,000 into specified safeguards to ensure compliance with sanctions.
Kraken Acquires From OFAC
Payward Inc. (d/b/a Kraken), a cryptocurrency exchange incorporated in Delaware, and the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury announced a settlement on Monday. The notification reads:
“Kraken agreed to remit $362,158.70 to settle its potential civil liability for apparent violations of sanctions against Iran … As part of its settlement with OFAC, Kraken also has agreed to invest an additional $100,000 in certain sanctions compliance controls.”
The Treasury Department reports that Kraken completed 826 transactions for a total of around $1,680,577.10 between roughly October 14, 2015 and June 29, 2019, on behalf of people who seemed to be in Iran at the time of the transactions.
The Treasury Department provided specifics:
“At the time of the apparent violations, Kraken did not implement IP address blocking on transactional activity across its platform.”
The Treasury Department stated that Kraken proactively self-disclosed the potential violations and assisted the OFAC’s investigation, and that the cryptocurrency trading platform also “taken significant corrective actions in response to the apparent violations.” The statement continues:
Following the discovery of this issue, Kraken introduced automated blocking for IP addresses associated with prohibited regions. Kraken also used a number of blockchain analytics tools to help with its monitoring of sanctions.
Over time, the Office of Foreign Assets Control has imposed sanctions on a number of bitcoin trading platforms. For instance, Bittrex, a cryptocurrency exchange, was accused of breaking sanctions in October.
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