According to online reports, according to an announcement on the official website of the New York Financial Services Bureau (DFS), Paxos was fined US$26.5 million and needed to invest an additional US$22 million for failing to conduct full due diligence on its former partner Binance and having major flaws in the anti-money laundering compliance system. The US $22 million was used to rectify the compliance system. The investigation found that Paxos did not effectively monitor suspicious transactions involving Binance, resulting in approximately US$1.6 billion in illegal funds flowing into and out of Binance between 2017 and 2022. In addition, Paxos's customer compliance and transaction monitoring procedures have long been imperfect and have failed to identify and process high-risk accounts and behaviors in a timely manner.