Crypto Firm Abra Agrees to $82M in Customer Refunds Over Unlicensed Mobile App
25 US states on Wednesday reached a deal with crypto platform Abra and its CEO for failing to obtain necessary licenses.
Abra will compensate customers in the 25 states for up to $82.1m, per a Wednesday settlement announcement with regulators. The involved states — including Washington, Texas, Georgia, and Ohio — waived monetary penalties to prioritize customer repayment.
Also, the settlement bars Abra’s CEO Bill Barhydt from involvement in money transmission or similar financial services within the 25 states for five years.
He attempted to downplay the deal, saying on X that “no penalties are being paid as part of this agreement as no users were harmed in any way.”
— Bill Barhydt (@billbarX) June 26, 2024
Unlicensed Crypto Services Come with Consequences
Last year, financial regulators in states including Washington, Arkansas, Georgia, and Texas led an investigation into Abra. It revealed that the firm offered crypto transactions through its mobile app without the necessary licenses.
To resolve the issues, Abra stopped US customers on its Abra Trade platform from buying, selling, or depositing crypto. The settlement now requires Abra to return any remaining cryptocurrency holdings to these customers in the involved states.
“State financial regulators take their role to protect consumers and prevent unlicensed activity seriously,” said Charlie Clark, CSBS Chair. “Companies that do not operate within the bounds of state laws will be held accountable.”
Abra Launches Crypto Platforms for Accredited Investors
Expanding its reach, Abra unveiled “Abra Prime” and “Abra Private” platforms earlier this year.
Abra Private caters to high-net-worth individuals and trusts with custom wealth management solutions. Meanwhile, Abra Prime serves institutions like hedge funds and venture capital firms, offering crypto investment services. Both benefit from Abra’s recent SEC approval to operate as an investment advisor.
