The exchange’s affiliate agrees to pay a fine and return illegally earned commissions from U.S. clients.
The U.S. Department of Justice (DOJ) has announced that it reached a settlement with Aux Cayes FinTech Co. Ltd., an affiliate of the OKX exchange, which requires the payment of over $500 million. The settlement includes $84.4 million in fines and $420.3 million in confiscated commissions earned from U.S. clients. According to the DOJ, OKX processed over $1 trillion in transactions from U.S. users while ignoring federal regulations for years.
According to the investigation, the company operated as a money transmission service (Money Service Business) without the required licenses, violating U.S. law. In a statement released on February 24, OKX confirmed that the involved U.S. clients are no longer on the platform and that no claims related to customer harm have been made. Through a post on X, the Seychelles-based exchange stated that the number of U.S. clients involved represented a small percentage of its total customer base, and none of these clients remain on its platform.
The company stated:
“In recognition of these gaps, the Company, on its own initiative, voluntarily retained a compliance consultant to help remedy the issues and enhance its overall compliance program, and plans to continue with this consultant into the future.”
U.S. Attorney Matthew Podolsky stated that OKX’s affiliate “knowingly violated anti-money laundering laws and facilitated suspicious transactions and criminal proceeds exceeding $5 billion.” Podolsky added:
“Today’s guilty plea and penalties emphasize that there will be consequences for financial institutions that avail themselves of U.S. markets but violate the law by allowing criminal activity to continue.”
FBI Deputy Director James E. Dennehy accused OKX of “flagrantly violating U.S. laws and encouraging users to provide false information to circumvent requisite procedures.” Dennehy stated:
“Furthermore, in their failure to adhere to U.S. law, significant illicit transactions which furthered other criminal activity went undetected on their platform.”
“Just enter a random country”
Since 2017, OKX had implemented a policy preventing people in the U.S. from making transactions on its exchange. However, according to the DOJ, the exchange actively sought clients in the U.S.
The company later began requiring all clients to provide information for the know-your-customer (KYC) process before trading, but according to the DOJ, company employees suggested that clients provide false information.
Citing an example, the DOJ reports:
“‘I know you’re in the U.S., but you could just enter a random country and it should work. You just need to input your name, nationality, and ID number. You could just put UAE and random numbers for the ID number.’”
The company also advertised in the U.S. and sponsored the Tribeca Film Festival. During the event, OKX allowed clients to promote the exchange, and at least one client provided a tutorial video on how U.S. clients could register using a VPN to hide their location, according to the DOJ.
