Last week, four U.S. financial regulatory agencies, including the SEC and the Federal Deposit Insurance Corp. (FDIC), joined the Global Financial Innovation Network (GFIN). Participation in GFIN will help the agencies clarify regulations and promote the early identification of emerging regulatory opportunities, challenges and risks. In related news, the U.S. Commodity Futures Trading Commission's (CFTC) fintech initiative, LabCFTC, is set to become an independent operating office of the agency. A newly independent LabCFTC, reporting directly to Chairman Heath Tarbert, will take on a greater role in engaging with the fintech community to develop and write regulations for new products involving technologies such as blockchain, digital assets and other novel financial technologies.

A New York federal judge recently resolved the CFTC's claims against a convicted fraudster, his co-conspirator and his British binary options company, ordering them to pay a total of more than $4.6 million in a default judgment. The CFTC claimed that the defendants had used digital assets to cheat investors, using a cryptocurrency to conceal their misconduct and make illegal off-exchange retail swaps.

Also in New York, the U.S. Attorney's Office of the Southern District of New York last week indicted a banking solution platform's principal on three criminal counts. Oz Yosef, the principal of Crypto Capital, was indicted on conspiracy to commit bank fraud, bank fraud and conspiracy to operate an unlicensed money transmitting business. As a result of the indictment, Yosef will forfeit listed assets that represent the number of proceeds traceable to his offenses. The president of Crypto Capital was later extradited to Poland by Polish authorities on charges of laundering approximately $390 million. In a final note, this week another instance of cryptocurrency SIM swapping hacking was reported in a lawsuit filed by a major cryptocurrency investor, who claims he lost $1.7 million in cryptocurrency in a SIM swapping attack.

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