(Bloomberg) -- Cryptocurrency exchange Kraken has agreed to pay a little over $360,000 to settle allegations that it violated US sanctions against Iran. 

“Due to Kraken’s failure to timely implement appropriate geolocation tools, including an automated internet protocol (IP) address blocking system, Kraken exported services to users who appeared to be in Iran when they engaged in virtual currency transactions on Kraken’s platform,” Treasury’s Office of Foreign Assets Control said in a statement Monday. 

As part of the deal, the company -- whose legal name is Payward Inc. -- agreed to invest an additional $100,000 to improve its sanctions compliance, including in training and technical measures to assist in sanctions screening.

“Even before entering into this resolution, Kraken had taken a series of steps to bolster our compliance measures,” Marco Santori, the company’s chief legal officer, said in a statement. “With these enhanced systems in place, we are in a stronger position to continue our mission of accelerating the adoption of cryptocurrency so people from around the world can achieve financial freedom and inclusion.”

OFAC characterized the apparent sanctions violations as “non-egregious” and said Kraken voluntarily disclosed them to the government, as well as cooperated with its investigation. Those factors were considered when reaching the settlement amount, the office said. 

The settlement comes at a difficult time for the crypto industry as companies and retail investors deal with the fallout of cryptocurrency exchange FTX’s spiral into bankruptcy earlier this month. Treasury officials have previously said they will hold digital-asset firms that violate their sanctions rules accountable. 

According to OFAC, between Oct. 14, 2015 and June 29, 2019, Kraken processed 826 transactions, totaling almost $1.7 million on behalf of individuals who appeared to have been in Iran at the time of the transactions.

OFAC said Kraken undertook a number of remedial actions to address the sanctions issue, including employing geolocation blocking technology to prevent customers in prohibited locations from accessing their accounts, hiring a dedicated person to lead their sanctions compliance program, and implementing blockchain analysis tools.  

(Adds statement from Kraken in the fourth paragraph.)

©2022 Bloomberg L.P.