Digitex Founder Admits Guilt for Failure to Implement Anti-Money Laundering Program

Former CEO of Digitex, Adam Todd, has pleaded guilty to violating the Bank Secrecy Act by failing to implement anti-money laundering (AML) and Know Your Customer (KYC) programs on the futures trading platform. Todd actively operated an unregulated platform that served US customers from 2018 to 2022. He also publicly refused to implement KYC policies for Digitex Futures. Despite a data leakage incident in 2020 that exposed user data, Todd discontinued all KYC checks. Todd’s guilty plea could result in up to five years in prison and a fine of $250,000. Former Binance CEO, Changpeng Zhao, faced similar charges and received a four-month prison sentence. Todd’s sentencing hearing has not been scheduled yet, but he stepped down as CEO in October 2022. In addition to the recent indictment, Todd also faced legal actions from the Commodities Futures Trading Commission (CFTC). The court granted a permanent injunction against Todd and his companies for attempting to manipulate the price of the platform’s native token, DGTX, using a computerized bot. The court ordered Todd to pay a $3.9 million disgorgement and an $11.7 million civil monetary penalty, and prohibited him from registering with the CFTC and trading in CFTC-regulated markets.