Canada’s Crypto Enforcement: $126M Penalty Imposed on Cryptomus Following 2,593 AML Violations

Cryptomus has been hit with an astonishing $126 million fine by Canada for violating the nation’s anti-money laundering regulations. Officially operating as Xeltox Enterprises Ltd and located in Vancouver, Cryptomus allegedly neglected to report thousands of potentially suspicious transactions, including those tied to severe crimes such as child exploitation, ransomware attacks, and evasion of sanctions.

In just July 2024, the firm opted not to disclose over 1,000 instances of dubious activity along with more than 1,500 reports related to substantial crypto transactions.

Canada’s financial regulatory body, Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), revealed the fine on 22 October 2025, stating that the company’s failure to report transactions significantly endangered the integrity of Canada’s financial infrastructure.

This represents the most substantial penalty FINTRAC has ever enforced on a single entity. The $126 million fine dwarfs the $14 million fine imposed on KuCoin just last month, marking it as nearly nine times higher.

Is the crypto law of cryptocurrency hindering innovation? In spite of hefty fines like the $126M against Canada’s Xeltox, compliant ventures see a 30% increase in adoption (data from BlackRock)! → Resist, fall behind in the Web3 race. Will Ethereum’s smart contracts for ‘auto-compliance’ render regulators obsolete? #Cry pic.twitter.com/jGCNESVz1h

— TrackerAI (@TrackerAI) October 22, 2025

Earlier in May, Binance’s Canadian division was also penalized with a $4.28 million fine for comparable infractions.

In both scenarios, the firms inadequately registered and failed to report significant or questionable crypto transactions, which is a fundamental legal requirement to combat money laundering.

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Cryptomus Concealed Child Abuse and Iran-Related Transfers

The Canadian financial authority emphasized that investigators uncovered that Cryptomus concealed transactions associated with child exploitation materials, ransomware, fraud, and transfers relating to Iran. In a separate statement, FINTRAC noted that Canada’s crypto sector exhibited critical vulnerabilities, facilitating criminal activities.

Weaknesses within Canada’s digital currency sector, “seriously undermine transparency and accountability and render the entire sector vulnerable to exploitation by illicit actors,” FINTRAC pointed out.

FINTRAC criticized the company’s internal systems as “incomplete and inadequate.”

Cryptomus Fined C$176.96 M by FINTRAC in Landmark AML Case

Canada’s financial intelligence agency FINTRAC has levied a historic fine of C$176.96 million (≈ US $126 million) against Xeltox Enterprises Ltd. (Cryptomus) for comprehensive anti-money laundering violations tied to child exploitation,… pic.twitter.com/zFVFwkmPc0

— Times of Distributed database (@TimesOfBlockC_) October 24, 2025

Moreover, the company neglected to adhere to a government directive mandating increased scrutiny on transactions involving Iran, bypassing additional reviews on over 7,557 transactions from July to December 2024.

The financial authority also discovered that the Vancouver address provided by the company was merely a rented mailbox, with no actual staff or offices in Canada, as all correspondence during the inquiry originated from either Uzbekistan or Spain.

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Cryptomus Transferred $250M In Crypto Via Sanctioned Trading network Garantex

Findings during the investigations revealed that Cryptomus had transferred approximately $250 million in cryptocurrency through Garantex, a Russian trading network under sanctions that has been accused by the US of enabling money laundering activities for criminals.

Researchers at TRM Labs reported to investigators that Cryptomus had connections to Nobitex, an Iranian exchange, and had engaged with various cybercrime networks operating out of Russia. They also confirmed observing direct transactions between Cryptomus and known criminal syndicates.

The founder of the company is identified as Sanjar Berdiev from Uzbekistan. A Kazakh patent attorney named Kakhanova Renata Andreyevna submitted the application for the company’s Canadian trademark license. She has also applied for a trademark for another venture called Xeltox in both the UK and Australia.

FINTRAC stated that Cryptomus provided outdated contact information, including a phone number not associated with the company and a non-functional email address.

The post Canada Crypto Crackdown: $126M Fine Thrown At Cryptomus After 2,593 AML Breaches appeared first on 99Bitcoins.