BitFlyer Fined $1.2M by NYDFS for Failing to Meet Cybersecurity Requirements
NYDFS acknowledged that bitFlyer presented the department with a plan to meet regulatory requirements by the end of the year
Sharaf Maksumov/Shutterstock modified by Blockworks
The New York Department of Financial Services (NYDFS) fined bitFlyer USA $1.2 million, alleging that the crypto exchange’s cybersecurity program had “multiple deficiencies” following an investigation.
The NYDFS said, “many of bitFlyer USA’s written policies and procedures were English translations of Japanese originals; some portions were poorly translated, while others (such as graphs) were not translated at all.”
The exchange also did not get board approval for policies, or conduct annual reviews.
BitFlyer cooperated with the investigation and the NYDFS said that it “credits” the company for working to bring the cybersecurity programs up to standard.
BitFlyer proposed a plan that would bring the company into compliance with the NYDFS’s requirements and will be compliant under this plan by the end of 2023.
The exchange will also be required to check in with the NYDFS quarterly to report its progress.
BitFlyer isn’t the first company that faced a fine for not meeting compliance requirements. BitPay, a crypto payments provider, settled with the NYDFS back in March.
In January, Coinbase and the NYDFS reached a $100 million settlement after the department found that it violated anti-money laundering laws back in 2018 and 2019.
In August of last year, Robinhood was hit with a $30 million penalty for cybersecurity, anti-money laundering, and consumer protection violations.
BitFlyer did not immediately respond to a request for comment.
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- 0xResearch: Alpha in your inbox. Think like an analyst.
