Targets, Turnarounds & Terminal Debasement
The U.S. Commodity Futures Trading Commission (CFTC) is ordering the Seychelles-registered cryptocurrency brokerage firm Falcon Labs to pay nearly $2 million to settle regulatory violations.
CFTC says that Falcon Labs failed to properly register with the regulator and will consequently pay a total of $1,768,512 in the regulator’s first action against an unregistered futures commission merchant (FCM).
“Falcon Labs is ordered to cease and desist from acting as an unregistered FCM by providing U.S. persons access to digital asset derivatives trading platforms. The order also requires Falcon Labs to pay $1,179,008 in disgorgement and a $589,504 civil monetary penalty.”
According to the CFTC, the crypto brokerage firm “solicited or accepted orders” from US-based customers from around October 2021 to at least March 27th of 2023.
“Throughout this period, Falcon Labs functioned as an intermediary facilitating customer trading on various digital asset exchanges, including institutional customers located in the U.S. Falcon Labs provided its customers with direct access to exchanges by first creating a main account in its own name and then creating associated sub-accounts. The exchanges generally did not require, and Falcon Labs generally did not provide, customer-identifying information for the sub-account holders.”
Falcon Labs’ settlement comes a little over a week since the chair of the CFTC, Rostin Behnam, warned that the cryptocurrency industry will “probably see in the next six to 18 months or six to 24 months another cycle of enforcement actions”.
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