Former Merrill Lynch Employee’s S Corporation Gets FINRA Fine Due to Crypto Mining Involvement
- FINRA imposed a $5,000 fine against a former Merrill Lynch employee.
- The employee, Kyung Soo Kim, was dismissed from the company in March last year for unreported cryptocurrency mining.
Former Merrill Lynch Employee Fined $5,000 for Engaging in Crypto Mining Activities
The cryptocurrency market within the United States is still a little shaky, but there are a few agencies that have clear cut rules that cannot be broken. Unfortunately, a former member of Merrill Lynch’s staff did not follow the rules, and he is about to pay out of his own pocket for his mistakes. According to legal documents, the Financial Industry Regulatory Authority (FINRA) has gone after Kyung Soo Kim with a $5,000 fine, due to his cryptocurrency mining.
According to the document that Kim had to sign – a “letter of acceptance, waiver, and consent” – FINRA decided to pursue Kim when he pursued activities that did not fall in line with the rules. Though he has had no previous record for disciplinary action, he was still obligated to report his actions when he created a new outfit for mining in December 2017 called S Corporation. The launch of this mining outfit coincided with the biggest spike that Bitcoin has ever seen. When Kim was with Merrill Lynch, the company raised this concern in March 2018, and ended up dismissing Kim from the company.
To add to the reasons that FINRA is imposing such a penalty, the entity explained that there is a vague rule that covers professional conduct, saying that there is even more reason for the fine. According to the letter, “FINRA Rule 2010 requires associated persons to observe high standards of commercial honor and just and equitable principles of trade.”
Along with the fine, Kim is not allowed to work or associate with any firm involved with FINRA for at least one month. This case brings even more attention to the regulatory space in the US with activities related to cryptocurrency, which is not a good sign for the industry this month, though it follows a trend.
FATF to Release Comprehensive Statements on Cryptos
According to earlier reports from Cointelegraph this month, the Financial Action Task Force (FATF) plans to be releasing dedicated cryptocurrency comments in the next week. The FATF, which provides recommendations on financial security to countries around the globe, may end up making recommendations for cryptocurrency businesses to follow the same requirements for exchange transactions over $1,000 that banks do. Still, experts have already expressed that this process is basically impossible.