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US commodities regulator received over $1.3 billion in penalties from crypto and other firms last year

By Ramla Soni

The CFTC maintained a record of pending litigations against corporate entities and individuals that involved allegations over Bitcoin

The United States Commodity Futures Trading Commission (CFTC) obtained over $1.3 billion (£1bn, €1.2bn) in administrative penalties in the fiscal year 2019, marking a 39 per cent increase over the previous year, and now stands as the fourth highest total in the agency’s history.

The CFTC did not specify the exact amount of regulatory penalties obtained from digital currency-related companies, but it mentioned several charges involving Bitcoin.

The commission charged the principal of a cryptocurrency escrow fund with a multi-million dollar Bitcoin fraud and also charged a Bitcoin trading firm and its principal with a $147 million-dollar fraud. A virtual currency trader was also charged with carrying out a fraudulent scheme involving Bitcoin.

The division maintained a record of over 140 pending litigations against corporate entities and individuals that involve allegations of manipulation, spoofing, fraud, misappropriation of confidential information, illegally offering new products, including digital assets, and other violations.

The number of actions filed by the CFTC during 2019 (69) marked a slight increase over the average of the prior five fiscal years. Out of this approximately 65 per cent of all cases filed during the year involved charges of commodities fraud, manipulative conduct, or spoofing, making it the second-highest year for these types of cases.

In 2019, the CFTC filed 16 actions in parallel with criminal authorities. This is more than in any prior year.

The $1.3 billion total covers all monetary relief ordered in CFTC actions, including in the form of civil monetary penalties, disgorgement, and restitution.

“Tough, but fair – that’s been our response to those who break the rules,” said CFTC Chairman Heath P. Tarbert. “A strong enforcement program is about preserving market integrity, protecting consumers, and deterring misconduct from taking place.”

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