Data from a recent report suggest that enforcement actions from U.S.
regulators against those in the crypto space cost those firms less than
1% of that in traditional finance for the last 20 years.
While regulators have often targeted projects in and out of the
crypto space, the fines levied against digital asset exchanges are a
fraction of those against traditional financial institutions.
According to data from Good Jobs First’s violation tracker, the platform analyzed
50 of the biggest fines regulators levied against major banks,
investment firms, and brokers over the last 20 years. Bank of America
accrued roughly $82 billion covering 251 different fines including
securities violations, while JPMorgan Chase and Citigroup were also some
of the most fined banks in the U.S. since 2000 with penalties totaling
$35.9 billion and $25.5 billion, respectively.
While both major
banks and crypto exchanges have often been penalized for securities
violations, data suggest that enforcement actions from U.S. regulators
against those in the crypto space cost those firms less than 1% of that
in traditional finance. Cointelegraph previously reported that from 2009
to early 2021, fines for crypto-related violations
have totaled $2.5 billion in the United States, while Good Jobs First’s
data shows there were $332.9 billion in penalties from banks,
investment firms, and brokers in the last 20 years.
One of the
largest actions came from the Securities and Exchange Commission, or
SEC, against Telegram’s 2018 initial coin offering. The company was
ordered to pay $1.2 billion in disgorgement and $18.5 million in civil
penalties in 2020 after being charged for violating securities laws. In
contrast, Bank of America was the target of the largest fine from the
Department of Justice — $16.6 billion — for selling “toxic” mortgages
related to the 2008 financial crisis.
In cases which involved the
SEC, Commodity Futures Trading Commission, and Financial Crimes
Enforcement Network against crypto firms and individuals, unregistered
securities offerings and fraud accounted for more than 90% of all fines.
“Toxic securities abuses,” as Good Jobs First describes them, accounted
for roughly 29% — $97 billion — of the $332.9 billion in total
penalties. Investor protection violations came in second with $68
billion.
Related: SEC enforcement actions cost crypto firms
Though crypto firms continue to be the target of enforcement action by U.S. regulators — in August, BitMEX agreed to pay up to $100 million
to resolve a case from the CFTC and FinCEN — there are signs lawmakers
in the country are becoming increasingly aware of the economic impact of
not having clear guidelines for innovative companies. Many U.S.
senators and representatives have gotten behind proposals to amend language
in an infrastructure going to the Senate this month. The legislation
suggests implementing tighter rules on businesses handling
cryptocurrencies and expanding reporting requirements for brokers.
source link : https://cointelegraph.com/news/banks-vs-exchanges-regulators-overwhelmingly-penalize-fiat-not-crypto
