BitGo has been fined after it was found that its cryptocurrency wallet service allowed access to entities in sanctioned countries. This regulatory penalty underscores issues in the company’s adherence to ethical business practices and proper economic oversight, potentially facilitating economic activities that could empower authoritarian regimes.

BitGo was fined $99K for digital currency sanctions violations due to inadequate compliance procedures. The enforcement action highlights shortcomings in the company’s oversight mechanisms intended to prevent financial flows that could aid authoritarian regimes.

BitGo settled with OFAC over its failure to prevent users in sanctioned jurisdictions from using its digital wallet services. The settlement, which required BitGo to pay nearly $100K, came after evidence showed that the company did not enforce controls such as IP-address blocking and location verification. BitGo subsequently invested in remedial compliance measures including hiring a chief compliance officer and upgrading its OFAC compliance policies.

The U.S. Office of Foreign Assets Control fined BitGo $98,830 for processing 183 cryptocurrency transactions from users in sanctioned countries such as Crimea, Cuba, Iran, Sudan, and Syria. The violation highlighted deficiencies in its sanctions compliance procedures, prompting the company to later implement remedial measures including hiring a chief compliance officer and updating its OFAC policy.