Adam Todd, the founder and CEO of Digitex Futures Exchange, faces federal charges for not adhering to the Bank Secrecy Act (BSA) by neglecting to establish a required Anti-Money Laundering (AML) program. The BSA mandates financial entities to maintain records and report certain transactions to the Financial Crimes Enforcement Network (FinCEN) to combat financial crimes effectively.

The U.S. Attorney's Office for the Southern District of Florida announced the charges on February 12, following an investigation by the FBI Miami. Assistant U.S. Attorney Trevor Jones is leading the prosecution, which accuses Todd of leaving the exchange vulnerable to misuse for money laundering and other illicit activities.

This legal action comes after Todd and Digitex were previously mandated by a U.S. federal court to pay $16 million in penalties for operating without registration with the U.S. Commodity Futures Trading Commission (CFTC) and for manipulating the price of its DGTX token. The indictment highlights Todd's deliberate avoidance of setting up a comprehensive AML and Know Your Customer (KYC) framework from January 2018 to April 2022.

Todd, who has publicly opposed KYC measures for Digitex Futures, made his initial court appearance regarding this case. A conviction could result in up to five years in prison.

This indictment follows an earlier court ruling that imposed significant financial penalties on Todd for regulatory non-compliance, including a nearly $12 million civil monetary fine and close to $4 million in disgorgement. Additionally, Todd and his associated entities have been barred from participating in CFTC-regulated markets.