Former BitMEX CEO Arthur Hayes Sentenced to 2 Years Probation
Hayes pleaded guilty to one count of violating the Bank Secrecy Act (BSA) in February, and faced a sentence of up to 12 months in prison.
Former BitMEX CEO Arthur Hayes was sentenced to two years of probation, with home detention for six months and location monitoring, in a federal courthouse in New York on Friday. Hayes had pleaded guilty in February to charges he willfully failed to implement an anti-money laundering (AML) program at the exchange.
Hayes, a longtime resident of Singapore, will be allowed 30 days to decide where in the U.S. he will serve his home detention. After living in Asia for 14 years, Hayes recently bought a home in Miami, but his lawyer said Friday he has no community in Florida and might wish to do his home detention elsewhere.
With over two dozen friends and family members in the courtroom behind him, including his wife, his mother and his brother, Hayes told the judge he took “full responsibility” for his actions.
“I deeply regret that I had a part in this criminal activity,” Hayes said. “My best years are ahead of me. … I am ready to turn the page and start again. I ask that you allow me to return home, deeply remorseful and able to start the next chapter of my life.”
Judge John Koeltl of the U.S. Southern District Court in New York agreed that Hayes would be able to travel internationally after successfully completing his period of home detention, checking in with his probation officer as necessary via video call from his home in Asia.
Hayes’s sentencing came as somewhat of a surprise. A plea deal Hayes made with the government earlier this year outlined a sentencing guideline of six to 12 months in prison. The charges he faced carried a maximum sentence of 10 years in prison.
But because Hayes was a first-time offender with a long track record of charitable work, the Probation Department recommended a period of two years probation with no incarceration.
In a sentencing memo submitted on May 12, prosecutors rejected the Probation Department’s recommendation and urged Judge Koeltl to hand down a sentence above the six- to 12-month sentence stipulated in the plea deal.
Judge Koeltl declined to do so, arguing that the court should treat Hayes as an individual, not as an example for other off-shore exchanges.
Hayes will also be allowed to continue communicating with BitMEX co-founders Samuel Reed and Ben Delo, who both pleaded guilty. Standard probation guidelines bar felons from communicating with other known felons, but Judge Koeltl agreed to make an exception for Hayes and his co-founders.
Hayes, Reed, and Delo – as well as the company’s first employee, Gregory Dwyer – were initially charged in October 2020 with one count each of violating the Bank Secrecy Act (BSA), and another of conspiring to do so.
Dwyer has pleaded not guilty to the charges. A trial is slated for later this year.
Hayes surrendered to U.S. authorities in Hawaii last April, in a deal brokered between his lawyers and federal prosecutors. He was released on a $10 million bond secured by $1 million in cash and co-signed by his mother.
UPDATE (May 20, 21:26 UTC): Updated throughout with additional detail and statements.
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