Multi-State Action Settled with Crypto Kiosk Operator for $2.5 Million

Thirty-four state money transmission regulators recently announced a consent order with a crypto kiosk operator. 

The order resolves findings from a multi-state examination of the crypto kiosk operator’s activity from March 31, 2023, through March 31, 2025.  The examination identified alleged deficiencies in the operator’s BSA/AML program. 

Examiners found that the BSA/AML program allegedly did not sufficiently mitigate risks, including specific deficiencies with respect to transaction monitoring controls, know-your-customer (KYC) and suspicious activity reporting (SAR) policies, enhanced due diligence policies, and recordkeeping.  As a result, the examiners believed that the deficiencies left the crypto kiosk operator’s business vulnerable to exploitation by criminal actors.

Under the terms of the order, the crypto kiosk operator will pay $2.5 million in administrative penalties and costs, distributed among the thirty-four states.  Additionally, the operator must cease all virtual currency kiosk operations in the thirty-four states by January 1, 2027, or be subject to an additional $4 million penalty. 

The crypto kiosk operator must also, among other things, engage an independent consultant to review its BSA/AML program and implement any required corrective actions.  The order does not revoke the operator’s money transmitter licenses, nor does it prohibit the company from engaging in activity other than virtual currency kiosk operations.