NYDFS fines Gemini $37M over compliance failures
By 
Jeff Dale2024-02-29T19:18:00
The New York State Department of Financial Services (NYDFS) fined cryptocurrency exchange Gemini Trust Company $37 million over alleged compliance failures related to lapses in safety and soundness.
As part of a settlement, Gemini committed to return at least $1.1 billion to customers of its “Earn” program through bankruptcy proceedings for Genesis Global Capital, the NYDFS announced in a press release Wednesday. Gemini will also contribute $40 million to the Genesis bankruptcy for the benefit of Earn customers.
In January 2023, the Securities and Exchange Commission charged Gemini and Genesis for failing to register their joint crypto lending product Earn. Months prior, the fallout from the collapse of crypto exchange FTX had a cascading effect on the industry and forced Genesis to lock customer accounts because of a lack of liquidity. It filed for bankruptcy shortly following the announcement of the SEC’s complaint.
THIS IS MEMBERS-ONLY CONTENT
You are not logged in and do not have access to members-only content.
If you are already a registered user or a member, SIGN IN now.
Related articles
-
News BriefNYDFS expects banks, firms to cut risks posed by AI, according to new guidance
New York financial institutions are expected to address cybersecurity risks posed by artificial intelligence, and new guidance from the New York Department of Financial Services is aimed at helping firms do just that.
-
News BriefGenesis penalized $21M by SEC for sale of unregistered securities
Crypto firm Genesis Global Capital agreed to pay a $21 million civil penalty to the Securities and Exchange Commission to settle charges that the Gemini Earn investment program was an unregistered security offering.
-
News BriefICBC fined $32M by NYDFS, Fed over compliance lapses
The Industrial and Commercial Bank of China and its New York branch agreed to pay $32.4 million in penalties levied by two regulators for failing to address compliance failures and for the unauthorized disclosure of confidential supervisory information to an overseas regulator.
More from Regulatory Enforcement
-
News BriefFTC orders GoDaddy to upgrade cybersecurity defenses following three breaches
The Federal Trade Commission has ordered web hosting company GoDaddy to implement a “robust” information security program following at least three data breaches that the agency said were aided by lax cybersecurity measures.
-
News BriefFTC shuts down student loan firms over deceptive debt relief practices
The U.S. Federal Trade Commission (FTC) took action against a pair of student loan debt relief companies for allegedly deceiving borrowers. The move came despite the Trump administration’s broader efforts to roll back enforcement actions against businesses since taking office.
-
News BriefCoinbase faces a leftover SEC probe as crypto enforcement loses steam
After dismissing its lawsuit against the crypto exchange Coinbase in March, a second investigation into the exchange by the Securities and Exchange Commission has surfaced, according to a report from the New York Times. This comes as a bit of a surprise after the Trump administration has been scaling down ...