Coinbase Europe settles €21.5m with Irish regulator over AML monitoring lapses

Coinbase Europe Limited has agreed to a €21.5 million settlement with the Central Bank of Ireland after regulator findings that technical faults in its transaction monitoring system left more than 30 million transactions insufficiently screened between 2021 and 2022. The Central Bank concluded the lapses delayed identification of potentially suspicious activity and represented roughly 31 percent of Coinbase Europe’s activity during the period.

The bank’s review found that three coding errors affected five of the exchange’s 21 monitoring scenarios, allowing certain crypto addresses separated by special characters to bypass automated screening. As a result, Coinbase Europe did not initially detect or report large volumes of transactions that should have been subject to further checks. The regulator said the unmonitored transactions were valued at more than €200 billion.

After detecting the issue through internal testing, Coinbase said it corrected the coding errors within weeks, rescreened affected records and filed 2,708 Suspicious Transaction Reports with Irish authorities following a review of about 185,000 transactions. Coinbase said those filings do not confirm illicit...