Ben Delo, co-founder of BitMEX, will serve his 30-month probation sentence without being detained at home.
Following charges of breaking the US Bank Secrecy Act, BitMEX co-founder Benjamin Delo was sentenced to 30 months probation without the possibility of home confinement (BSA).
Delo and BitMEX founder Arthur Hayes pled guilty earlier this year to charges brought by the Department of Justice (DOJ) accusing them of “willfully failing” to implement anti-money laundering safeguards at the exchange.
The prosecution against the founders began two years ago, when the DOJ accused Delo, Hayes, and BitMEX’s first formal employee Greg Dwyer of running a “money-laundering platform” between September 2015 and September 2020.
The inability of the exchange to execute AML and Know-Your-Customer processes was essential to the department’s argument in the case for their BSA violations.
If the case had gone to trial, the maximum term for BSA offenses would have been five years, but the couple were able to arrange a plea agreement in which the DOJ argued for a 6-12 month prison sentence.
Hayes and Delo agreed to pay a $10 million fine in a parallel civil lawsuit filed in February with the Commodity and Futures Trading Commission, which was also part of the arrangement with the DOJ. Hayes had already received a six-month home detention term and two years of probation for his role.
According to a representative for the New York-based law firm Smith Villazor LLP, which is representing Delo, the court rejected the government’s “cynical attempt to exaggerate the seriousness” of the BSA claim.
The spokesperson said:
“Today’s sentence of probation recognized that this case involved a compliance lapse that led to a regulatory violation and nothing more. The government’s campaign – both in the courtroom and in the press – to malign Ben with highly inflammatory and misleading language concerning Ben’s conduct gained no traction with the court.”
Delo has finally settled all regulatory disputes connected to BitMEX, according to the spokeswoman, with the recent settlement with the CFTC.
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