Kraken Under Federal Investigation

Kraken, one of the largest crypto exchanges, is being investigated under suspicion of violating U.S. sanctions according to a recently posted New York Times article. Kraken is accused of allowing users in Iran to buy and sell digital tokens, breaking OFAC Sanctions against Iran (imposed in 1979). The sanction prohibits the export of goods or services to people or entities in the country.

The U.S. Treasury Office of Foreign Assets Control (OFAC) has been “investigating Kraken since 2019 and is expected to impose a fine, said the people, who declined to be identified for fear of retribution from the company.” According to Times, Kraken had also allowed customers to open accounts in Syria and Cuba, which are also sanctioned by the U.S.

Crypto payment processor BitPay was fined for violating sanctions in February 2021. BitPay agreed to remit just over $500,000 to “settle its potential civil liability for 2,102 apparent violations of multiple sanction programs. BitPay processed payments from persons apparently located in a sanctioned region of Ukraine, Cuba, North Korea, Iran, Sudan, and Syria.