Coinbase’s UK arm, CB Payments Limited, got slapped with a hefty $4.5 million fine from the Financial Conduct Authority (FCA). Why? They broke a promise to keep high-risk customers off their platform.
What Happened?
Back in 2020, CBPL agreed to limit onboarding new customers the FCA considered “high-risk.” This was supposed to help prevent criminal activity and money laundering. But guess what? CBPL let 13,416 high-risk customers join anyway!
The FCA wasn’t happy. They said CBPL’s controls were “seriously flawed” and they weren’t doing enough to protect against financial crime.
The Fallout
This fine is a big deal. It’s the first of its kind in the crypto world and sends a clear message: companies need to take financial crime seriously. If you don’t follow the rules, you’ll face consequences.
Coinbase’s stock took a hit after the news broke, dropping nearly 2%.
Coinbase’s Response
Coinbase said they’re committed to following the rules and acknowledged they messed up. They’re working to improve their systems and said the FCA recognized their cooperation with the investigation.
They also pointed out that only 0.3% of new customers were high-risk, so it was an accident.
What’s Next?
Everyone’s watching to see how Coinbase fixes this problem. Will they be able to regain trust and prove they’re serious about following the rules?
