By Maiya Keidan
TORONTO (Reuters) -Canada’s anti-money laundering regulator said on Wednesday it had imposed a C$176.9 million ($126.14 million) fine on money services business Xeltox Enterprises Limited, the largest-ever penalty doled out by the agency.
The regulator, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), said Xeltox did not submit suspicious transaction reports when there were reasonable grounds to suspect transactions related to the laundering of money connected to trafficking in child sexual abuse material.
Xeltox, also operating as Cryptomus and previously known as Certa Payments Limited, is a money services business incorporated in British Columbia. It could not be reached for comment.
“Given that numerous violations in this case were connected to trafficking in child sexual abuse material, fraud, ransomware payments and sanctions evasion, FINTRAC was compelled to take this unprecedented enforcement action”, the agency said in a statement.
Xeltox also failed to report the receipt of more than C$10,000 in virtual currency from a client, FINTRAC said.
Canada has been signalling efforts to clamp down on financial crime. On Monday the government announced a new agency to combat fraud, money laundering and recover criminal proceeds.
Next month the country will face an audit by global financial crime watchdog Financial Action Task Force.
On September 25, FINTRAC imposed a C$19.6 million ($14.09 million) penalty on Peken Global Limited, the operator of one of the world’s largest cryptocurrency exchanges KuCoin.
KuCoin appealed the penalty, previously FINTRAC’s highest ever, and said the fine was excessive and punitive.
($1 = 1.4024 Canadian dollars)
(Reporting by Maiya Keidan, Editing by Franklin Paul)
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