An investigation into cryptocurrency company Anchorage Digital Bank, a Wall Street-backed startup that has been a steadfast advocate of President Donald Trump’s agenda on digital assets, has been initiated by a U.S. Department of Homeland Security unit that fights money laundering and other financial crimes.
According to persons familiar with the investigation, former Anchorage Digital workers have been approached by Homeland Security’s El Dorado Task Force in recent weeks to ask about the company’s procedures and guidelines.
It was unclear what the undisclosed inquiry was about. Homeland Security’s investigative branch oversees the El Dorado Task Force, which claims that one of its goals is to “disrupt and dismantle transnational money laundering organizations” through the use of “aggressive proactive investigations.”
An Anchorage representative chose not to comment. Homeland Security representatives remained silent.
The 400-person company is well known for its custody services and provides cryptocurrency solutions to governments and financial institutions, including trading and asset protection. Anchorage was announced as BlackRock’s new custodian for its cryptocurrency exchange-traded products last week.
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As part of a consent agreement, the Office of the Comptroller of the Currency ordered Anchorage to address inadequate controls related to client due diligence, suspicious customer monitoring, and anti-money-laundering safeguards in April 2022.
In its ruling at the time, the banking watchdog said that Anchorage had broken the Bank Secrecy Act, which deals with preventing financial crime, and that the company was working to address the problems the OCC had discovered.
In order to combat money laundering, Anchorage stated at the time that it has “already been working to strengthen the areas identified and will continue to bolster these areas, reinforcing a new, digital asset standard” for controls. The consent order still applies to Anchorage.
Homeland Security’s investigation comes as Anchorage cultivates relationships with Trump administration officials who may tighten rules on cryptocurrency and emphasizes its status as a licensed bank to lawmakers and authorities in Washington, D.C.
For years, Anchorage and its cryptocurrency rivals have interacted with lawmakers and authorities from several administrations. Trump has promised to make the United States “the crypto capital of the world” and provide opportunities for the sector while pushing his own coin.
On April 4, McCauley posted a picture of himself with Bo Hines, the executive director of the President’s Council of Advisers for Digital Assets, along with the caption, “Crypto is in good hands.”
McCauley is now a spokesperson for a subject that Trump has supported: stopping “debanking,” which is the practice of a bank terminating a customer’s account because it believes the relationship is too hazardous to continue.
McCauley echoed the assertions of other cryptocurrency executives that their accounts were closed when he appeared before the Senate Banking Committee in early February regarding his company’s debanking experience.
To assist steer the company as the crypto regulatory landscape changes, Anchorage has added seasoned bankers and former regulators to its executive team and board of directors.
TuongVy Le, a former Securities and Exchange Commission crypto investigator, was appointed general counsel of Anchorage last year. According to someone acquainted with Le’s thinking, she just moved into an adviser position with Anchorage because she is evaluating offers from outside the company. Le is the second general counsel to leave Anchorage in as many years.
Anchorage was co-founded eight years ago by McCauley and Diogo Mónica, who is currently the executive chairman of Anchorage and general partner at Haun Ventures, a venture capital firm that focuses on digital assets.
After a fundraising round in 2021, its most recent valuation was $3 billion. Anchorage obtained what is now the sole national bank charter for a U.S. cryptocurrency company from the OCC that January under former regulator Brian Brooks.
