The cryptocurrency arm of Robinhood Markets Inc. has been ordered to pay a $30 million fine as part of a settlement resolving allegedly “significant” lapses in its cybersecurity and anti-money laundering compliance, New York’s financial services regulator announced Tuesday.
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In addition to the monetary fine, the settlement announced by the New York State Department of Financial Services, also requires that Robinhood Crypto LLC hire an independent consultant to analyze and evaluate the company’s remediation efforts and compliance with the state agency’s regulations.
“As its business grew, Robinhood Crypto failed to invest the proper resources and attention to develop and maintain a culture of compliance — a failure that resulted in significant violations of the department’s anti-money laundering and cybersecurity regulations,” DFS Superintendent Adrienne Harris said in a statement.
“All virtual currency companies licensed in New York State are subject to the same anti-money laundering, consumer protection and cybersecurity regulations as traditional financial services companies,” Harris noted. “DFS will continue to investigate and take action when any licensee violates the law or the department’s regulations, which are critical to protecting consumers and ensuring the safety and soundness of the institutions.”
Cheryl Crumpton, associate general counsel of litigation and regulatory enforcement at Robinhood, said of the agreement, “We are pleased the settlement in principle reached last year and previously disclosed in our public filings is now final.”
“We have made significant progress building industry-leading legal, compliance and cybersecurity programs, and will continue to prioritize this work to best serve our customers,” Crumpton added. “We remain proud to offer a more accessible, lower-cost platform to buy and sell crypto and are excited to continue to grow our business in a responsible manner with new products and services that our customers want.”
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Source: https://www.law360.com/articles/1517451/ny-hits-robinhood-crypto-with-30m-fine
