The New York government fined Robinhood $30 million for its crypto business.

The New York State Department of Financial Services has fined Robinhood’s crypto division $30 million, the latest in what appears to be a string of problems for the company. It’s the regulator’s first crypto-focused enforcement action, with the multimillion-dollar fine levied against Robinhood for alleged violations of the state’s anti-money laundering and cybersecurity regulations. Following a supervisory examination, the Financial Services Department discovered significant deficiencies in the company’s compliance programs, according to the announcement. 

There were apparently insufficient people working in Robinhood’s money laundering compliance program.

In addition, the company failed to transition from a manual monitoring system, which is no longer adequate now that it is much larger than when it began.

Furthermore, the department discovered that Robinhood’s cybersecurity policies are not fully compliant with official cybersecurity and virtual currency regulations. 

In addition, the New York regulator stated that Robinhood incorrectly certified compliance with the Department’s Transaction Monitoring Regulation and Cybersecurity Regulation.

Robinhood broke the law by claiming compliance despite the fact that it was not fully compliant with the state’s cybersecurity rules.

Finally, the regulator stated that Robinhood violated consumer protection requirements by failing to keep a separate phone number (and display it on its website) for consumer complaints. 

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