BitPay Agrees to Pay $507,375 to Settle with OFAC

​The US Treasury's Office of Foreign Assets Control (OFAC) announced that it has fined BitPay, a private company based in Atlanta with $507,375 for transactions with sanctioned countries.

Specifically, between approximately June 10, 2013 and September 16, 2018, BitPay processed 2,102 transactions on behalf of individuals who were located in sanctioned jurisdictions. 

BitPay received digital currency payments on behalf of its merchant customers from those merchants' buyers who were located in sanctioned jurisdictions, converted the digital currency to fiat currency, and then relayed that currency to its merchant

The company was aware that based on the IP address data it collects, users from Ukraine, Cuba, Iran, Sudan and Syria logged into BitPay platform.

While BitPay screened its direct customers and conducted due diligence to ensure they were not located in sanctioned jurisdictions, the company failed to screen location data that it obtained about its merchants' buyers.

The firm's systems failed to analyze all data required for compliance with OFAC sanctions and therefore did not implement control measures to prevent such users from accessing its service.

BitPay's sanctions compliance program deficiencies enabled persons in these sanctioned jurisdictions to engage in approximately $129,000 worth of digital currency-related transactions with BitPay's merchant customers.

The organization said that the settlement amount reflects OFAC's determination that BitPay's apparent violations were not voluntarily self-disclosed and were non-egregious.