Britain's Financial Conduct Authority (FCA) today said that it has fined CB Payments Limited (CBPL)—a part of Coinbase—just over £3.5 million ($4.5 million) for allowing "high-risk customers" to buy crypto.

In a Thursday statement, the regulatory watchdog said that CBPL, which allows customers to buy crypto on Coinbase, had said it would engage with the FCA in a bid to tack financial crime.

But CBPL onboarded and/or provided e-money services to 13,416 high-risk customers, according to the FCA. The agency said that approximately 31% of these customers collectively deposited $24.9 million, and made transactions totaling $226 million.

The FCA hit the Coinbase subsidiary with the £3.5 million fine as a result. It is the first such fine of its kind. Therese Chambers, the FCA's joint executive director of enforcement and market oversight, said that the regulator would "not tolerate such laxity."

"The money laundering risks associated with crypto are obvious and firms must take them seriously," she said.

"CBPL's controls had significant weaknesses and the FCA told it so, which is why the requirements were needed. CPBL, however, repeatedly breached those requirements," she continued, adding that CBPL's weaknesses "increased the risk that criminals could use CBPL to launder the proceeds of crime."

"We take the FCA's findings and our broader regulatory compliance very seriously and CBPL continues to proactively enhance its controls to ensure compliance with its regulatory obligations," Coinbase said in a statement.

Coinbase is the biggest digital asset exchange in the U.S. and one of world's best-known crypto brands. Users can sign up to the platform and buy and sell a large number of digital coins and tokens, such as Bitcoin, Ethereum, and USD Coin.

Edited by Andrew Hayward