A task force unit within the U.S. Department of Homeland Security (DHS) has opened an investigation into crypto firm Anchorage Digital Bank. The law enforcement and regulatory agency aims to assess whether the company’s practices defend against money laundering and other financial crimes.
Notably, Anchorage is known for its backing by prominent investors, including Goldman Sachs and Wellington Management. The company is also a custodian for significant crypto offerings, as shown by its recent role as a custodian for BlackRock’s crypto exchange-traded products.
DHS Investigates Anchorage
According to Barron’s report, Homeland Security officials have contacted former Anchorage employees to understand the firm’s internal practices and policies. While the scope of the probe is not disclosed, it’s noteworthy that the task force is mandated to “disrupt and dismantle transnational money laundering organizations” via aggressive investigations.
The probe hints that regulators have the firm on their radar, as this is not the first regulatory scrutiny it has witnessed. In April 2022, the OCC issued a consent order against the company for shortcomings in client due diligence, transaction monitoring, and other anti-money laundering controls required under the Bank Secrecy Act.
The regulators’ interest in the company is unsurprising as its CEO, Nathan McCauley, is a vocal advocate of a non-regulated crypto environment. In recent appearances, including a testimony before the Senate Banking Committee and the Crypto Ball event in Washington, the executive emphasized that crypto is in good hands, suggesting that regulations are unnecessary.
Meanwhile, the result of the launched investigation could affect other crypto-related firms as federal regulators seek to integrate crypto platforms into traditional finance frameworks. Also, no further details have been provided by Anchorage or DFS regarding the matter.
Probes Are Part of the Game
Probes into financial and crypto firms are not new. They are designed to ensure adherence to compliance and security standards. Such investigations often arise following significant security incidents or operational mishaps. For example, the OKX DeFi Platform was recently scrutinized following the Bybit hack.
The recent probe into Anchorage may be surprising, given the progressive regulatory environment that has been gradually shaping since the Donald Trump administration. In recent moves, the SEC ended its probe into Uniswap while halting its investigation into Robinhood, suggesting that enforcement efforts decrease as firms comply with the existing frameworks.
