Canada fines Xeltox C$176.9M for AML reporting failures

Canada's financial intelligence agency on Wednesday imposed a record C176.9 million fine on Vancouver-based Xeltox Enterprises Ltd., which operates the cryptocurrency platform Cryptomus, saying the company failed to file thousands of required reports on large and suspicious virtual currency transactions. The Financial Transactions and Reports Analysis Centre of Canada said the breaches occurred largely in July 2024 and involved transfers that raised reasonable grounds to suspect links to money laundering, including proceeds tied to child sexual exploitation material, fraud, ransomware payments and sanctions evasion.

FINTRAC said its compliance review identified 2,593 distinct breaches of reporting and record-keeping obligations. That tally included 1,068 failures to file suspicious transaction reports and 1,518 instances in a single month in which the firm did not report receipt of virtual currency transfers meeting or exceeding Canada’s C10,000 reporting threshold. The agency also said Xeltox did not verify or report 7,557 transactions between July and December 2024 that were linked to Iran and fell under a Ministerial Directive requiring enhanced scrutiny.