By CCN: For the first time, FinCEN – the Financial Crimes Enforcement Network – has fined a peer-to-peer Bitcoin trader for failure to register as a money services business. MSBs fall under FinCEN’s regulation, and according to FinCEN, Eric Powers, reportedly a resident of California, willfully violated registration requirements. He’s also accused of looking the other way when knowingly doing business with Silk Road vendors.
$5 Million in Crypto Trades Net Bitcoin Trader a $35,000 Fine
Eric Powers learned an expensive lesson: you can’t trade Bitcoin without the government’s permission. | Source: Shutterstock
FinCEN says that Powers admitted to buying over $5 million in cryptocurrencies throughout 160 transactions, doing many of the trades in public places. It doesn’t mention what platform he used but does say he used a “Bitcoin forum” and also worked with people through the dark web a few times.
“Mr. Powers advertised his intent to purchase and sell bitcoin on the internet. He completed transactions by either physically delivering or receiving currency in person, sending or receiving currency through the mail, or coordinating transactions by wire through a depository institution. Mr. Powers processed numerous suspicious transactions without ever filing a SAR, including doing business related to the illicit darknet marketplace ‘Silk Road,’ as well as servicing customers through The Onion Router (TOR) without taking steps to determine customer identity and whether funds were derived from illegal activity.”
The case highlights the crypto policies of presidential candidate Andrew Yang, in that FinCEN is one of several agencies which claim jurisdiction over Bitcoin markets.
8/ Here, it looks like FinCEN wanted to settle two debates once and for all. It believes:
1) Mere two-party exchange is "money transmission"
2) Individuals can be money transmitters
(2) should be obvious. (1) is deeply problematic.
— Marco Santori (@msantoriESQ) April 19, 2019