Stripe—Stripe paid $120,000 settlement to Massachusetts AG over inadequate fraud prevention in PlexCoin cryptocurrency scheme
In September 2020, Stripe settled with the Massachusetts Attorney General for $120,000 over allegations that its risk monitoring and fraud prevention practices were inadequate, enabling the fraudulent PlexCoin ICO. Between August and September 2017, PlexCorps held six Stripe accounts used to obtain millions of dollars. The AG alleged Stripe knew or should have known of the fraud in time to prevent harm to 22 Massachusetts investors. Stripe terminated the accounts in September 2017 and subsequently bolstered its protections.
Scoring Impact
| Topic | Direction | Relevance | Contribution |
|---|---|---|---|
| Consumer Protection | -against | primary | -1.00 |
| Corporate Governance | -against | secondary | -0.50 |
| Overall incident score = | -0.248 | ||
Score = avg(topic contributions) × significance (medium ×1) × confidence (0.66)× agency (negligent ×0.5)
Evidence (2 signals)
CoinDesk reported Stripe settlement with Massachusetts AG over PlexCoin ICO fraud facilitation
CoinDesk reported that Stripe agreed to pay $120,000 in a settlement with the Massachusetts Attorney General over the PlexCoin ICO fraud. PlexCoin's Canadian backers raised $15 million during the ICO boom. The report noted the settlement amount represents neither a penalty nor a fine, and that Stripe pledged to assist the AG's ongoing investigations.
Massachusetts AG announced Stripe paid $120,000 settlement over PlexCoin cryptocurrency fraud
Massachusetts Attorney General Maura Healey announced that Stripe agreed to pay $120,000 to resolve allegations that its risk monitoring and fraud prevention practices violated state consumer protection law. The AG alleged Stripe knew or should have known about fraud by PlexCoin operator Dominic Lacroix, who used six Stripe accounts between August and September 2017 to illegally obtain funds from 22 Massachusetts investors.