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Robinhood Crypto Entity Faces $30M Fine After Money Laundering Probe

The crypto subsidiary of retail-focused stock and cryptocurrency exchange Robinhood Financial LLC faces a $30 million fine after a probe into its financial regulations compliance conducted by New York state investigation authorities.

What Happened: According to a Securities and Exchanges Commission (SEC) filing from July 19, the investigation into Robinhood Crypto’s practices was initiated in July 2020.

The New York State Department of Financial Services (NYDFS) revealed “alleged violations of anti-money laundering and New York Banking Law requirements.”

Why It Matters: Those violations purportedly include “failure to maintain and certify a compliant anti-money laundering program.”

Robinhood has settled with the NYDFS and is expected to pay a monetary penalty of $30 million and engage a monitor for its future activities.

The document in question is Robinhood’s S-1 form filed with the SEC as part of the firm’s preparation for its initial public offering (IPO).

As Benzinga reported this Monday, the company is proposing to offer 55 million shares at an estimated price range of $38 to $42.

What Else: This development takes place amid increasing regulatory scrutiny on cryptocurrency companies.

Binance — the world’s leading crypto exchange — notably saw many of its payment processing partners cut ties with it and now mostly relies on its relationship with Mastercard Inc. (NYSE: MA) and Visa Inc. (NYSE: V).

Read also: Robinhood Delays IPO After SEC Review Of Its Crypto Business: Report

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights
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