Stripe paid $120,000 to stay away from the alleged involvement in a crypto scam as the Massachusetts Attorney General’s Office claimed the company was inadequate to detect illicit ICO-related transactions as we are reading more in the latest crypto news.
The American payment processor Stripe paid $120,000 in order to resolve the allegations that its systems didn’t detect illegal transactions. The Massachusetts Attorney General’s office alleged that the company made payments which are an alleged crypto scam. The initial coin offering allegedly defrauded the customers of $8 million. Back in July, three Canadian citizens were charged with fraud in connection to PlexCoin an initial coin offering that was used to defraud the investors of $8 million according to the US Attorney Office in the Northern District of Ohio.
Among the investors, 22 of them are from Massachusetts where the local AGO alleged that Stripe’s platform was used to transfer some of the PlexCoin’s funds. The assurance of discontinuance said:
“Stripe processed payments facilitated by Dominic Lacroix – the owner of ‘PlexCoin’ – and his associates, resulting in the fraudulent and unregistered offer and sale of cryptocurrency.”
The AGO alleged that Stripe’s fraud prevention system seems to be inadequate and it could not detect illicit transactions as the documents stated:
“The AG’s Office further alleges that Stripe knew or should have known of Lacroix’s fraud in time to prevent harm to Massachusetts consumers, but failed to do so due to its inadequate risk monitoring and fraud prevention and mitigation practices and procedures.”
To settle the allegations, Stripe agreed to pay the $120,000 to AGO which could be applied for the amelioration of harm to Massachusetts consumers, monitoring, and investigative costs.” The document stressed that none of the funds should be considered as a penalty or a fine. The agreement doesn’t constitute an admission by Stripe of any fact or non-compliance with any state or federal law, regulations, or fuel. On Stripe’s behalf, the settlement requires that the company’s security protocols will protect the customers in the future “as well as regular training for employees regarding risk monitoring and fraud prevention.”
The AGO also agreed to not take any actions against Stripe and the PlexCoin case.
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