- Xeltox/Cryptomus fined C$177M for failing to report over 1,000 suspicious cryptocurrency transactions.
- Violations included child abuse, fraud, ransomware, and sanctions-related transactions.
- The company previously faced action from the BC Securities Commission for operating an unauthorized exchange.
The Financial Transactions and Reports Analysis Center of Canada (Fintrac) has imposed its largest-ever fine on Xeltox Enterprises Ltd., operating as Cryptomus, after it allegedly failed to comply with anti-money laundering (AML) regulations.
The Vancouver-based cryptocurrency services provider was fined C$177 million ($126 million) for multiple violations related to suspicious transactions, according to a statement released on Wednesday.
widespread failure to report;
Fintrac’s investigation found that Cryptomus was failing to report thousands of transactions a month, creating serious compliance issues.
The agency noted that the company neglected to file reports on more than 1,000 transactions in July 2024 that raised reasonable suspicions they were linked to money laundering, including proceeds related to child sexual abuse material, fraud, ransomware payments and sanctions evasion.
Regulators also found that Cryptomus failed to report more than 1,500 transactions during the same period in which customers transferred more than C$10,000 of virtual currency in a single transaction.
These reporting mistakes led Fintrac to take “unprecedented enforcement action,” reflecting the seriousness of the potential financial crime risks involved.
Sarah Paquet, CEO of Fintrac, noted that the company had repeatedly failed to meet its AML obligations, stressing that the scale and nature of the breach required the agency to take decisive action.
Pre-regulatory investigation into Cryptomus
Cryptomus, formerly known as Certa Payments Ltd., offers a variety of cryptocurrency services including trading, payments, wallets, and peer-to-peer exchanges.
The company previously attracted the attention of Canadian regulators.
Last May, the BC Securities Commission accused Cryptomus of potentially operating as an unauthorized exchange.
Provincial regulators issued a temporary order suspending trading in the company’s securities or derivatives until June, underscoring ongoing concerns about financial compliance.
Cryptomus’ operations in Canada and its previous enforcement record highlight the challenges regulators face in overseeing cryptocurrency platforms, especially when transactions may intersect with illicit activity.
The latest fines represent a significant expansion of enforcement, signaling Canadian authorities’ intention to hold cryptocurrency companies accountable for strictly adhering to AML regulations.
Implications for the Cryptocurrency Sector
Record penalties for Xeltox and Cryptomus send a clear signal to cryptocurrency companies operating in Canada. This means that compliance with anti-money laundering regulations is essential and failure carries significant financial and operational risks.
The company’s alleged negligence illustrates the risks posed by platforms that process large amounts of unmonitored digital transactions.
Fintrac’s decision highlights that cryptocurrency platforms must treat regulatory compliance as a core operational priority rather than an afterthought to avoid similar penalties in the future.
The C$177 million fine represents the largest enforcement action in Fintrac’s history and sets a new standard for regulatory outcomes in Canada’s growing digital asset industry.