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A Judicial review on disclosing STR/SARs sent to the FIU

17/08/2022
Background
  1. A cryptocurrency billionaire who pleaded guilty to breaking American anti-money laundering rules is to bring a landmark legal challenge to Britain's data regulator.
  2. Lawyers for Ben Delo, a co-founder of BitMEX, said he had been granted permission for a judicial review of the Information Commissioner's Office. It is thought to be the first time a decision by the watchdog has gone to court.
  3. The move is the latest twist in a dispute between Delo and Wise Payments, a money transfer business.
  4. Delo sued Wise, formerly known as TransferWise, last December over allegations that the company had refused his requests under data protection regulations to hand over information about him that it had submitted to the National Crime Agency.
SARS/STRS FILED
  1. Wise had filed three suspicious activity reports to the agency, a move normally made when a business suspects that funds might be the proceeds of economic crime or may involve money laundering.
  2. Delo challenged Wise's refusal to hand him the data on the reports to the agency, but the information commissioner backed the company.

LAWYERS SAY

  1. Delo's lawyer, Matt Getz of Pallas Partners, said that
    • "The information commission is meant to protect the data protection rights of individuals – and it hasn't done so in this case".
    • Delo had taken the latest legal proceedings "reluctantly, but out of principle, wanting to ensure that entities such as Wise fully comply with their data protection obligations and that the ICO adequately upholds the information rights of individuals, which is in the wider public interest".
    • The information commissioner's office of " failing to perform its duties".
    • Delo will argue at the court hearing that
      • He was entitled to the information under the general data protection regulations of the European Union, which were incorporated into UK law under the Data Protection Act 2018.
    • To be successful at the judicial review, Delo will have to prove that
      • The information commissioner acted unlawfully, irrationally or had failed to adhere to its procedures or standards.
    • A spokesman for the commissioner's office said:
      • "We won't be commenting on any ongoing proceedings that will be considered by the courts."
WISE
  1. Wise denied it had been in breach.
    • Delo challenged Wise's refusal to hand him the data on the reports to the agency, but the information commissioner backed the company.
  2. A spokesman for Wise said:
    • "We stand by our robust defence and deny that we breached Mr Delo's data protection rights in any way.
    • We made clear to Mr Delo that unless he discontinued the claim we would apply to court to strike it out, and we are pleased that he decided to discontinue."
  3. Delo's legal team confirmed he had withdrawn from proceedings against Wise.
Delo has previously been found Guilty
  1. In June, and was given 30-month probation in New York after he was found to have breached anti-money laundering laws.
  2. In February, Delo pleaded guilty to violating the Bank Secrecy Act in the US by failing to operate a "know-your-customer" procedure for BitMEX, [based in Seychelles]
    • Fined $10 million as part of what was reported by The Wall Street Journal as a deal with prosecutors and the Commodity Futures Trading Commission.
    • At the sentencing, Delo told the judge that he regretted not having acted sooner to ensure that BitMEX was not dealing with US customers. "It was a terrible decision," he said.

SOURCE

EU