OCIF shuts down Athena Bitcoin’s Puerto Rico operations
The Office of the Commissioner of Financial Institutions (OCIF, in Spanish) has issued a cease-and-desist order against Athena Bitcoin Inc., a Monetary Services Business (MSB) that was allegedly illegally operating under in Puerto Rico under the Act to Regulate Monetary Services Businesses
In its Resolution and Order released Sept. 9, the OCIF reiterated its earlier denial of the license application filed by Athena because of its failure to comply with the obligation to submit information and/or documents required by the law including (1) sufficient and reliable information to establish its compliance with capital and assets requirements; (2) the required bond; and (3) audited financial statements.
Further, the agency notified Athena that, at present, OCIF has not authorized its monetary transfers business and commercial transactions in Puerto Rico, so the company must immediately cease and desist all its commercial operations in Puerto Rico.
“[t]he OCIF accorded Athena all due process of law, including multiple opportunities to comply with the clear mandates of Law No. 136-2010,” said OCIF Commissioner Natalia Zequeira in a press release.
“However, without any legal justification, Athena has failed in its obligation to submit the totality of the information and/or documents necessary to finalize the licensing process applicable to its monetary transfers business….Further, in a reckless manner, Athena has continued its commercial operations in Puerto Rico fully aware that it does not hold a valid license issued by OCIF, as required by law,” according to the that Zequeira issued.
In response to a request for comment from News is my Business, Georgia Ruiz-Torres, chief marketing and communications officer for Athena Bitcoin, said, “Puerto Rico is an important business market for Athena Bitcoin Global and our subsidiary operating in Puerto Rico.”
“We’re obliged in providing the best service to our customers while committed to full compliance as a business entity. We’re cooperating with the court’s proceedings as they remain pending,” she said.
On April 22, OCIF issued Circular Letter CIF-CC-2021-3 to establish the requirement of a license in the case of MSBs covered by the applicable law, specifically those that operate Bitcoin Teller Machines (“BTMs”) kiosks or convertible virtual currency and/or cryptocurrency ATMs.
OCIF’s letter followed guidance issued by the US Department of the Treasury’s Financial Crimes Enforcement Network that states that owner-operators of convertible virtual currency kiosks that accept and transfer value, must comply with the norms applicable to MSBs.
Among other factors, Zequeira said that OCIF considered the fact that the Federal Financial Institution Examination Council — the entity that groups banking regulators in several US mainland jurisdictions — considers MSBs to be high risk in regards to potential money laundering crimes.
“As we have reiterated in the past, OCIF will not allow or tolerate any financial entity — whether a bank, international banking entity or monetary services business — operating within Puerto Rico’s financial system to do so outside the law or in disregard of the clear mandates of applicable laws and regulations,” said Zequeira.
The Resolution and Order scheduled an administrative hearing on Sept. 20, 2022, to give Athena a chance to be heard on the matter, after which OCIF could “confirm, modify or annul” the order.