CoinList agrees to $1.2M settlement over apparent US sanctions violations

CoinList, a United States-based cryptocurrency exchange, has agreed to a $1.2 million settlement with Treasury’s Office of Foreign Assets Control (OFAC) following allegations the firm facilitated transactions in apparent sanctions violations.

In a Dec. 13 notice, OFAC said CoinList had processed 989 transactions for users in Crimea — the peninsula formerly a part of Ukraine currently being occupied by Russia — from April 2020 to May 2022. According to OFAC, the apparent sanctions violations were “nonegregious” but “not voluntarily self-disclosed.”

“[CoinList’s] screening procedures failed to capture users who represented themselves as resident of a non-embargoed country but who nevertheless provided an address within Crimea,” said OFAC. “In particular, [CoinList] opened 89 accounts for customers, nearly all of whom had specified ‘Russia’ as their country of residence but all of whom provided addresses in Crimea upon account opening.”

OFAC said that CoinList “knew or had reason to know” the transactions were likely residents of Crimea, in violation of U.S. sanctions and economically benefiting the region. However, the exchange cooperated with U.S. officials, and the volume of transactions in apparent violation of sanctions represented “a very small percentage” of the exchange’s total volume.

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In 2014, Russian forces annexed Crimea, which until then had been part of Ukraine. U.S. President Barack Obama imposed sanctions on the region following the occupation, which preceded additional sanctions on Russia when the country’s military invaded Ukraine in February 2022.

Other U.S. crypto firms have faced similar enforcement actions by OFAC since the sanctions were first imposed. In May, Poloniex agreed to a $7.6 million settlement related to more than 65,000 apparent violations of multiple sanctions, including those on Crimea. Binance’s $4.3 billion settlement with U.S. officials over allegations of money laundering and fraud also included apparent sanctions violations.

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