A Vancouver-based cryptocurrency exchange has been fined nearly $177 million, marking the largest penalty ever imposed by Canada’s financial intelligence agency. The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) announced the fine against Xeltox Enterprises Ltd., which operates under the name Cryptomus, on Wednesday. The company was previously known as Certa Payments Ltd.

The hefty fine of $176,960,190 was levied due to multiple infractions, including the failure to report over 1,000 transactions suspected of being linked to criminal activities. These activities include trafficking in child sexual abuse material, fraud, ransomware payments, and evading sanctions.

FINTRAC found that Cryptomus did not submit reports for 1,068 transactions in July 2024 that had reasonable grounds for suspicion of money laundering or terrorist financing. Additionally, the agency identified 1,518 instances where the company failed to report transactions exceeding $10,000 in virtual currency during the same month.

Sarah Paquet, FINTRAC’s director and CEO, stated, "Given that numerous violations in this case were connected to trafficking in child sexual abuse material, fraud, ransomware payments and sanctions evasion, FINTRAC was compelled to take this unprecedented enforcement action."

The agency also noted that Cryptomus did not comply with a Ministerial Directive regarding transactions from Iran, which should have been treated as high risk. The company failed to verify the identities of senders and beneficiaries, maintain transaction records, and report these transactions to FINTRAC.

This fine surpasses the previous record of approximately $20 million, which was imposed on Peken Global Ltd., the operator of the cryptocurrency firm KuCoin, in September. The recent penalty against Cryptomus is part of a broader effort by Canadian authorities to combat online crime and enhance regulatory measures in the cryptocurrency sector.

In May, the British Columbia Securities Commission temporarily banned Cryptomus from trading securities and engaging in other market activities due to alleged violations of registration requirements.

The Canadian government is also taking steps to strengthen its response to financial crimes. Finance Minister François-Philippe Champagne recently announced plans for a new Financial Crimes Agency, which aims to improve the country’s ability to address online scams, money laundering, and other fraudulent activities. This initiative will be supported by legislative changes to the Bank Act, expected to be unveiled in the spring.

According to the Canadian Anti-Fraud Centre, Canadians lost $643 million to online fraud in 2024, nearly three times the amount reported four years earlier. Only a small percentage of these scams, estimated at five to ten percent, are reported to authorities. FINTRAC, which operates under the Minister of Finance, is tasked with detecting, preventing, and deterring money laundering and terrorist financing while safeguarding personal information.