YEREVAN (CoinChapter.com) — President Donald Trump reportedly issued pardons to Arthur Hayes, Benjamin Delo, and Samuel Reed, the three co-founders of BitMEX, a cryptocurrency exchange. This move comes after the three men pleaded guilty to charges related to money laundering and violations of the Bank Secrecy Act.
The March 28 CNBC report stated that Trump granted the pardons, but the White House had not confirmed the decision at the time. This follows a trend of controversial pardons granted by Trump, including pardons for people involved in the January 6 Capitol riot and Ross Ulbricht, the founder of Silk Road.
Legal History of BitMEX Co-Founders
In February 2022, Arthur Hayes and Benjamin Delo pleaded guilty to failing to establish proper Anti-Money Laundering (AML) programs at BitMEX, violating U.S. financial regulations. Samuel Reed followed shortly after, also admitting his role in the legal violations.
The legal troubles stemmed from accusations that the exchange allowed users to engage in transactions without proper oversight, violating U.S. laws meant to prevent money laundering. These actions led to federal charges and scrutiny from U.S. authorities, ultimately resulting in guilty pleas from the three men.
Financial Penalties and Civil Cases
As part of the settlement with the U.S. Commodity Futures Trading Commission (CFTC), Hayes, Delo, and Reed were ordered to pay $30 million in penalties. This was part of a broader legal resolution where BitMEX and its parent company, HDR Global Trading Limited, agreed to pay $100 million in 2021 as part of a settlement with the CFTC and the U.S. Financial Crimes Enforcement Network (FinCEN).
Additionally, the CFTC and U.S. authorities imposed further penalties on HDR Global Trading. In January 2023, a judge imposed a $100 million fine on the company, along with two years of unsupervised probation.
Trump’s Pardon Raises Questions
The rationale behind the Trump pardon is not clear. At the time of the report’s publication, the White House had not issued a statement about it. This decision is part of a broader pattern of pardons for high-profile figures facing legal challenges. However, the BitMEX case stands out due to its connection to a major cryptocurrency exchange.
This case involves leaders of BitMEX who were facing serious legal consequences in the U.S. The legal issues faced by BitMEX shed light on the larger challenges cryptocurrency exchanges face when complying with U.S. financial regulations. Although the company continued operations after the legal proceedings, its founders’ legal troubles have significantly affected its reputation. Additionally, the financial penalties further compounded the situation.
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