February 28, 2022

Coinbase discloses NYDFS investigation of subsidiary’s compliance with BSA, sanctions and cybersecurity laws

In a recent securities filing by Coinbase Global Inc., an American company that operates cryptocurrency exchange platform, the company disclosed that the New York State Department of Financial Services (NYDFS) was investigating the compliance program of its subsidiary Coinbase Inc. related to its “compliance with the Bank Secrecy Act and sanctions laws, cybersecurity, and customer support.”  According to the Form 10-K, which was filed on February 25, 2022, Coinbase Inc. is subject to NYDFS examination because it holds a Bitlicense from the NYDFS.  Coinbase Global also reports that the subsidiary is fully cooperating with the NYDFS and, as a result, “ has undertaken initial remedial measures, and may face additional remedial and other measures.” Because the investigation is ongoing, Coinbase Global is uncertain of the outcome.

Form 10-K