New York AG settles with Hong Kong-based trading platform CoinEx

New York Attorney General Letitia James on Thursday announced a settlement with CoinEx, a Hong Kong-based virtual currency trading platform the state sued earlier this year for failing to register.

As part of the agreement, CoinEx must refund nearly 5,000 New York investors a total of $1.2 million and pay more than $600,000 in penalties. The company is banned from offering securities and commodities in New York and prohibited from making its platform available in the state.

"Unregistered crypto platforms pose a risk to investors, consumers, and the broader economy,” James said in a statement. "Today’s agreement should serve as a warning to crypto companies that there are hefty consequences for ignoring New York’s laws. My office will continue to crack down on crypto companies that brazenly disregard the law, mislead investors, and put New Yorkers at risk.”

New York's crypto crackdown 

James has escalated her office's crackdown on the crypto industry this year and last month introduced proposed legislation that could force companies to refund customers who are victims of fraud. She has also sued KuCoin, along with former Celsius CEO Alex Mashinsky.

New York state has one of the toughest regulatory regimes for crypto companies in the U.S. with its BitLicense that's overseen by the state's Department of Financial Services.

James renewed her call on Thursday for New Yorkers "affected by deceptive conduct in virtual assets" to report issues to state authorities. 

"Attorney General James also encourages workers in the cryptocurrency industry who may have witnessed misconduct or fraud to file an online whistleblower complaint with her office," her office said.