Cryptocurrency Trading Company Shuts Down Following $8 Million Fine By New York State For Security Breaches – CryptoInfoNet – Mudcreep

A digital currency trade enterprise has ceased operations after consenting to an $8 million fine and the relinquishment of its authorizations to state oversight bodies in New York, having been found noncompliant with various financial industry norms, including those pertaining to cybersecurity.

Genesis Global Trading, Inc. experienced “regulatory oversights” that “rendered the firm susceptible to unauthorized dealings and threats to information security,” encompassing potential acts of money laundering, according to the New York State Department of Financial Services (DFS) stated on Friday.

Visitors to the company’s homepage were greeted with the following notice as of Tuesday: “Genesis Global Trading, Inc., has ceased to conduct business operations.”

The official consent order issued by DFS chronicled the enterprise’s breach of its BitLicense regulations, a requisite license for virtual currency enterprises in the state. Devised in 2015, its purpose is to safeguard customers, with New York authorities striving to pioneer a framework that could be adopted on a national scale as they have indicated.

Commentary from the Albany Times Union highlighted the fact that the enforcement announcement closely followed a state audit by the comptroller, which flagged lax supervision of the BitLicense by the DFS.

The consent order did not elaborate on specific electronic threats encounted by Genesis Global Trading, yet it brought attention to certain inadequacies in their required cybersecurity risk evaluations filed in December 2022; these were not only “submitted years behind schedule,” but they were also “not meticulously exhaustive” and did not properly reckon with the cybersecurity dangers faced by the company’s business model.

While DFS stopped short of pointing to explicit instances of money laundering via Genesis Global Trading, the department did express concerns about the company’s conspicuous lack of filing sufficient suspicious activity reports (SARs) aligned with possible criminal actions.

The DFS notice alluded that the quantity of SARs recorded during a certain review timeframe was disproportionately low relative to the volume of transactions handled, casting doubts on the robustness of the company’s systems to detect and report dubious activities.

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