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BitPay charged $500k as settlement for multiple violations related to crypto payments


finbold.com 2021-02-21 16:10
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The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has revealed that crypto payments platform BitPay has agreed to settle its potential civil liabilities on 2,102 apparent violations of sanctions programs.

In an enforcement notice published on Feb. 18, the OFAC said that BitPay will pay $507,375 as a settlement on charges that allege the Atlanta-based firm allowed persons based in North Korea, Iran, Syria, Sudan, and the Crimea region of Ukraine to transact with merchants based in the United States and elsewhere. 

BitPay allows merchants to accept payments in Bitcoin (BTC) and other cryptocurrencies. It handles the paperwork and facilitates transactions when customers buy goods or services using cryptocurrency. It then converts the digital assets into fiat currency for the merchants. 

OFAC said that BitPay allowed the transactions regardless of knowing customers’ IP addresses and other location data, enabling persons from sanctioned jurisdictions to purchase from merchants in the US and elsewhere using cryptocurrency.

The agency said that between June 2013 and September 2018, BitPay allowed approximately $129,000 worth of these illegal transactions. 

“The Apparent Violations related to BitPay’s payment processing service, which enables merchants to accept digital currency as payment for goods and services. Specifically, BitPay received digital currency payments on behalf of its merchant customers from those merchants’ buyers located in sanctioned jurisdictions, converted the digital currency to fiat currency, and then relayed that currency to its merchants.”

Violations of the U.S. sanctions

OFAC said that BitPay’s conduct violated the Blocking Property of Certain Persons and Prohibiting Certain Transactions with Respect to the Crimea Region of Ukraine executive order, the Cuban Assets Control Regulations, the North Korea Sanctions Regulations, the Iranian Transactions and Sanctions Regulations, the Sudanese Sanctions Regulations, and the Syrian Sanctions Regulations.

The agency published the enforcement notice following BitPay’s announcement on Feb. 12 that it now supports Apple Pay and will likely roll out support for Google Pay and Samsung Pay later this quarter. 


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