Crypto finance company reveals possible Iran-related sanctions violations in recent securities filing

Circle Internet Financial Limited, a Boston-based crypto finance company that is reportedly planning to go public, revealed in a recent securities filing that it received subpoenas from the US Department of the Treasury’s Office of Foreign Assets Control and an unnamed Iranian government agency related to transactions involving registered exchange accounts for Poloniex, a cryptocurrency formerly owned by Circle that discontinued operations in November 2019.  According to Exhibit 99.6 of the form 8-K that Circle filed with the SEC on July 8, 2021, the subpoenas relate to Poloniex exchange accounts associated with “persons resident or located in embargoed jurisdictions” that processed transactions, including deposits, withdrawals and trades of digital assets, in violation of “various sanctions.”  Circle estimates that its penalties from OFAC and Iranian sanctions violations could be between $1.1 million to $2.8 million.  Circle indicated that it reported the lower liability range of $1.1 million on Consolidated Balance Sheets and Consolidated Statements of Operations as accrued expenses and losses related to Poloniex’s discontinued operations. Circle reveals, however, that the amount of the loss may change in the near term and material consequences are possible.

Form 8K – Exhibit 99.6