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The French authorities have taken action against BYKEP, withdrawing its registration as a crypto-assets service provider with immediate effect.
The board of the Autorité des Marchés Financiers (AMF) took action following an on-site inspection that was conducted by its fellow financial watchdog, the Autorité de Contrôle Prudentiel et de Résolution (ACPR).
This, according to the AMF, revealed facts that called into question the conditions of BYKEP’s registration.
The company BYKEP was registered as a digital asset service provider (DASP) by the AMF in February 2021 after receiving a positive opinion from the ACPR.
The ACPR began carrying out an inspection of BYKEP in May this year to verify its compliance with the conditions of its registration as a DASP.
The ACPR found that implementation of the anti-money laundering and counter-terrorism financing (AML/CTF) framework submitted in support of its DASP registration application revealed failures, which the AMF said justify the initiation of a withdrawal procedure.
In particular, the ACPR found that some transactions had been carried out on clients' wallets without their consent.
They also showed serious failures in the AML/CTF framework, specifically in the management of the know your customer (KYC) files, in the tighter scrutiny of high-risk transactions and in the implementation of asset freezing measures.
In September, the company also informed the AMF and the ACPR of a theft of digital assets that had taken place via a cyberattack.
This concerned a substantial portion of its clients' assets, for a value estimated by the company at approximately €300,000 on the date of the alleged theft.
The AMF has said that it has asked the company to inform its clients as soon as possible and is closely monitoring this case. It also warned the company that legal action may be taken.
BYKEP was founded in 2018 and says on its LinkedIn page that it “set out to make cryptocurrencies a reality for everyone”.
According to the firm, since then, it has built a network of 30,000 retail outlets across Europe and has a web solution and mobile app.
