The FATF, or the Financial Action Task Force, has recently announced that it will be focusing particularly on the involvement of crypto in money laundering cases. This will result in a tightening of regulations in the field and will hopefully help the organisation rein in the expanding role of cryptocurrencies in issues of money laundering and other criminal activities.
The intergovernmental organization aims to contain the issue of money laundering and it plans to now regulate the functioning of digital currency exchanges for attaining that goal.
This will help curb the use of cryptocurrencies for criminal purposes. Since the inception of cryptocurrencies, there have been concerns about them being used for illegal, untoward activities.
Steven Mnuchin, the US Secretary of the Treasury, has said that the crypto service providers must follow the AML (anti money laundering) and CFT (combating the financing of terrorism) standards that are used by ordinary financial institutions.
In fact, he said that crypto firms should work on developing identities behind the wallets sending and receiving crypto, conduct a thorough study of a company’s assets and liabilities so as to ensure that illegal activities are not occuring. They should also create risk-free programs.
“By adopting the standards and guidelines agreed to this week, the FATF will make sure that virtual asset service providers do not operate in the dark shadows. This will enable the emerging FinTech sector to stay one step ahead of rogue regimes and sympathisers of illicit causes searching for avenues to raise and transfer funds without detection.”
Simon Riondeta, the head of financial intelligence at Europol, Simon Riondeta stated during an interview that the use of virtual currencies for money laundering purposes has been on the increase. He said:
“We also have some investigation on the dark web in which the payments are made in cryptocurrencies, sometimes in bitcoin [BTC], and they are switching it to more anonymised. Europol is a European Union law enforcement agency.”
Clearly, the money laundering concerns around crypto are not going to wane anytime soon. However, with measures by leading agencies like the FATF, they might be curbed to some extent.