Washington State DFI Takes Action against Digital Access LLC

Olympia - The Washington State Department of Financial Institutions (DFI) issued a Statement of Charges against Digital Access, LLC, alleging Digital Access's crypto kiosks charged consumers up to a 31% markup of the fair market value of digital assets, per transaction. These markups were not appropriately disclosed to customers and totaled more than $1 Million during a two-year period charged to Washington consumers on top of other transaction fees. DFI's Charges follow an examination that found significant noncompliance with legal requirements.

The Charges also allege that Digital Access:

• Created an environment of non-compliance with Anti-Money Laundering and Bank Secrecy Act laws and did not provide appropriate risk-based controls to adequately protect elderly consumers;
• Did not have sufficient due diligence policies and procedures, allowing customers to continue with transactions without capturing accurate identity and/or source of funds verification;
• Did not have sufficient transaction monitoring;
• Did not comply with federal and state reporting requirements;
• Did not retain records required for Currency Transaction Reports;
• Did not correctly handle unclaimed consumer property;

"Washington State regulatory requirements exist to protect consumers from unfair and deceptive practices," DFI Director Charlie Clark said. "DFI will take action to seek restitution for consumers who are harmed by violations of the law and to hold companies accountable to operate in compliance with state law."

Based on the alleged violations of the Uniform Money Services Act, DFI seeks to revoke Digital Access's license, prohibit the company and its responsible individual from the industry, order consumer refunds of all fees and markups charged that totals more than $1 Million, and order the company and its responsible individual to pay a fine of $1,006,175.

This is the fourth recent enforcement action brought by DFI against a crypto kiosk company that seeks substantial sanctions due to the nature of the alleged violations that harmed Washington consumers. Digital Access and its responsible individual both have a right to request a hearing to contest DFI's Charges. If DFI enters the order sought for consumer refunds, consumers who are eligible will be contacted by Digital Access and the Department will monitor the refund process. Washington State consumers may submit complaints about any other issues with crypto kiosks via DFI's online complaint form.

Documents

• Statement of Charges