NYDFS penalized Genesis Global Trading, a licensee that served primarily as an OTC trading shop, $8MM for cybersecurity, BSA/AML, and Consumer Protection violations. Genesis Global has now surrendered its license, apparently after having ceased trading activity some time ago. According to DFS allegations:
• Genesis Global did not conduct an enterprise-wide risk assessment until 2022, despite the fact that it received its license in 2018
• The 2022 risk assessment determined that controls intended to mitigate risks associated with Genesis Global’s business were “weak and marginal”
• Deficiencies identified in cybersecurity and AML programs, especially the lack of a cybersecurity risk assessment and issues with transaction monitoring and SAR reporting
• Attention should be paid to the atomization of violations, with the Order finding upwards of 18 different violations of the BitLicense Regulation (Part 200) and the Cybersecurity Regulation (Part 500)