- Abu Dhabi’s FSRA imposed significant penalties, including an $8.85 million fine on Hayvn and additional fines totaling $3.6 million on Flinos.
- Hayvn’s financial services license was revoked for failing to maintain proper risk management systems and controls.
- The FSRA investigation revealed that Hayvn, AC Holding, and Flinos created over 200 misleading documents while promoting unlicensed crypto services.
Hayvn and former CEO Christopher Flinos face additional fines of over $12 million from Abu Dhabi’s financial watchdog for alleged breaches relating to AML regulations and unlicensed activities.
Abu Dhabi Regulator Revokes Hayvn’s License
On Monday, April 14, the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) announced that it was taking enforcement action against Hayvn Group and Flinos for violating regulatory requirements and conducting unlicensed crypto operations. The press release of the FSRA said the company was fined $8.85 million and had its financial services license revoked.
For its part, ADGM’s Registration Authority has separately handed out $3.6 million in fines, $3.3 million of which was directly levied on Flinos for his participation in ‘various fraudulent schemes.’
It also imposed further penalties: a $3.6 million fine on Hayvn Cayman, a $3 million fine on Hayvn ADGM, a $1.5 million fine on AC Holding, and a $750,000 fine against Flinos personally. The FSRA also banned Flinos from holding any financial services position in ADGM.
Hayvn Failed to Maintain AML Compliance Systems
According to the regulator’s investigation, Hayvn ADGM allowed client trades to pass through AC Holding, which was not licensed to operate. According to the FSRA, Hayvn could not ‘establish and maintain adequate systems and controls to manage operations and applicable risks’ or maintain proper client relationship records for AML purposes.
The FSRA also found that client transactions related to the conversion of Virtual Assets to fiat currency and vice versa had been routed through accounts belonging to AC Holding that Hayvn Cayman controlled. The investigators also found that Hayvn Cayman, AC Holding, and Flinos ‘created and disseminated false and misleading information,’ including that they produced more than 200 false and misleading documents.’
Such information is available on Hayvn’s website, and the platform allows users to buy and sell cryptocurrencies through over-the-counter services and take in crypto payments online and offline. In November, the board of Hayvn authorized a lead to acquire FTX Pay, the FTX payment division, through an open public auction. In the past, FTX Pay was considered strategic as it had partnerships with significant companies like Mastercard. But it isn’t a given that Hayvn did complete the acquisition.
