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New York state has fined the crypto arm of trading giant Robinhood for allegedly violating consumer protection and anti-money laundering laws.

According to a new Press release Robinhood failed to maintain regulatory standards, according to an investigation by the New York Department of Financial Services (DFS).

DFS found that Robinhood had “significant deficiencies” in its Bank Secrecy Act/Anti-Money Laundering (BSA/AML) protocols, such as understaffing, insufficient monitoring technology used at the scale of its operations, and insufficient cybersecurity systems used.

“Director of Financial Services Adrienne A. Harris announced today that Robinhood Crypto will pay a $30 million fine to New York State for significant lapses in the areas of bank secrecy/anti-money laundering obligations and cybersecurity that led to violations of the department’s [regulations]. ”

DFS also found that Robinhood failed to comply with consumer protection requirements by failing to provide a consistent phone number for customers to call and complain.

Additionally, DFS said Robinhood was falsely certified as compliant, despite its many shortcomings.

According to DFS director Adrienne Harris, Robinhood’s compliance with the law has declined as the company has grown in size.

“As the business grew, Robinhood Crypto failed to devote the appropriate resources and attention to developing and maintaining a compliance culture — a failure that resulted in serious violations of the department’s anti-money laundering and cybersecurity regulations.

All virtual currency companies licensed in New York State are subject to the same anti-money laundering, consumer protection and cybersecurity regulations as traditional financial services companies.

DFS will continue to investigate and take action when any licensee violates the law or department, which is critical to protecting consumers and ensuring the safety and integrity of the institution. ”

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Featured Image: Shutterstock/Mia Stendal

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