OKX, one of the largest cryptocurrency exchanges globally, has pled guilty to operating an unlicensed money transmitting business in the United States.
This admission comes after a lengthy investigation by the US Department of Justice and the Federal Bureau of Investigation, revealing that the exchange had flouted federal anti-money laundering (AML) regulations for more than seven years.
According to press release by the US DoJ, by failing to register as a money services business (MSB) and not implementing the necessary AML and know-your-customer (KYC) programs, OKX allowed “over $5 billion” in suspicious transactions to flow through its platform.
OKX Accepts Penalties, Commits to Compliance Measures
In a plea deal, OKX agreed to pay more than $504 million in penalties. US District Judge Katherine Polk Failla accepted the guilty plea and presided over the sentencing.
Acting US Attorney Matthew Podolsky highlighted that OKX knowingly violated AML laws, enabling the exchange to facilitate illicit activities.
The Federal Bureau of Investigation’s Assistant Director in Charge, James E. Dennehy, stated that OKX’s actions included advising individuals on how to circumvent KYC protocols and failing to detect substantial illicit transactions. Dennehy noted:
For years, OKX flagrantly violated U.S. law, actively seeking customers in the United States—including here in New York—and even going so far as to advise individuals to provide false information to circumvent requisite procedures.
OKX employees reportedly encouraged customers to provide false information to bypass KYC requirements. The US DoJ highlighted an instance which occurred in April 2023 where an OKX employee wrote:
I know you’re in the US, but you could just put a random country and it should go through. You just need to put Name, nationality, and ID number. You could just put United Arab Emirates and random numbers for the ID number.
The agency also pointed to another instance which occurred in January 2024 where the same employee asked an individual if they had “any workaround on KYC outside of the US to make it potentially work.
As part of the agreement, OKX has retained an external compliance consultant to enhance its policies and controls, which will be monitored through February 2027.
Key Penalties From Authorities
The court documents outlined a pattern of deliberate non-compliance. It particularly stated that OKX knew it needed to register with the US Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) but avoided doing so.
This non-registration enabled the company to process transactions for US-based retail and institutional clients without proper oversight. During the relevant period, OKX allowed customers to open accounts without completing a KYC process.
According to the DoJ, this approach not only violated US law but also provided an avenue for money laundering. The penalties include $420.3 million in criminal forfeiture and an $84.4 million fine. The company received a 25% reduction in its fine due to cooperation and remedial efforts.
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