Australian bitcoin mogul Greg Dwyer has been sentenced to one year probation after being found guilty of violating US banking laws while he was a senior executive at troubled cryptocurrency exchange BitMEX, as his advisers slammed authorities for their heavy-handed approach to his charges.
Dwyer will be allowed to serve his probation outside of the United States given that his residence is currently in Bermuda. He was also fined $US150,000 as part of his sentence to charges brought against him by the US Department of Justice.
The Sydney University and St Ignatius graduate was sentenced recently after pleading guilty to the charge after his co-accused – the founders of BitMEX – had entered guilty pleas for similar charges.
Dwyer was charged alongside the three co-founders of BitMEX in late 2020 with willfully breaching American banking laws by allowing customers to sign up to the cryptocurrency betting group using fake passports and other incorrect information to bypass anti-money laundering laws.
US regulators that brought the action against BitMEX and its senior most executives have described the group as a “platform for money laundering” that operated in “the shadows of the financial markets”.
Dwyer was the first employee at BitMEX. The group remains one of the world’s largest bitcoin and cryptocurrency-related exchanges. BitMEX, which processed more than $US950 billion in transactions in 2020, has been conservatively valued at $US3 billion.
BitMEX’s chief executive and co-founder Arthur Hayes remains a high profile player in the cryptocurrency scene despite being sentenced to six months of house arrest after being charged alongside Dwyer and the group’s two other founders Ben Delo and Sam Reed.
Before his arrest, Dwyer was also well known within the cryptocurrency scene, giving interviews to Business Insider and appearing at a bitcoin conference in Manhattan in 2019.
According to the US criminal indictment, Dwyer worked as a senior executive within the group from 2015, running its Manhattan office and operating as head of business development. In 2019, he moved to work at BitMEX’s offices in Bermuda.
A spokesman for Dwyer said he would be moving on with his life following the sentencing.
“The government’s heavy-handed approach with respect to the prosecution of Mr. Dwyer is regrettable, and Mr. Dwyer is relieved to have this matter behind him and looks forward to getting on with his life – both personally and professionally.”
The spokesman added that Dwyer was the head of business development at BitMEX, never held any compliance or legal or regulatory role at the group, and his ownership stake of the company was small.
“Even the government concedes that Mr Dwyer did not have control over BitMEX’s operations or the company’s approach to compliance, and we are not aware of charges of this nature ever being brought against a similarly situated individual.”
The Department of Justice has previously described Dwyer as a key player in BitMEX’s breaches of the law, which included serving customers it knew were using fake identification to get around sanctions or to launder the proceeds of online scams.
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Source: Thanks smh.com