U.S. Treasury Official Wants Global Regulators to Follow Suite

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U.S. Treasury Official Wants Global Regulators to Follow Suite

By Bhushan Akolkar
Posted on Dec. 5, 2018

Image source: CNN Business


A senior official from the U.S. Department of Treasury has urged the global regulatory bodies from the financial space and crypto industry, to take necessary measures and prevent the illicit use of digital currencies by the bad actors. 


Sigal Mandelker - Secretary for Terrorism and Financial Intelligence - was speaking at the Financial Crimes Enforcement Conference on Monday, December 3, where she said that her agency is keenly observing the developments in the global crypto space, and that there is a need for collective and stronger regulatory oversight. 


She further added that cryptocurrency service providers and global financial institutions should take concrete measures to combat nefarious activities. “The digital currency industry must harden its networks and undertake the steps necessary to prevent illicit actors from exploiting its services,” said the secretary. 


Moreover, she also stressed that there’s a dire need to strengthen regulatory frameworks for anti-money laundering and terror-financing done using digital currencies. Additionally, the agencies should enforce and continuously supervise the newly amended laws. 


“The lack of AML/CFT regulation of virtual currency exchangers, hosted wallets, and other providers — and, indeed, of the broader digital asset ecosystem — across jurisdictions exacerbates the associated money laundering and other illicit financing risks,” she said. 


Citing the Example of Introducing Sanctions on Iranian Residents


During her speech, secretary Mandelker also gave an example of how the Treasury Department Office of Foreign Asset Control (OFAC)’s introduced sanction on two Iranian residents last week. The Bitcoin addresses of the residents were sanctioned for converting Bitcoin ransoms into Iranian rials.


“As Iranian and other bad actors attempt to misuse digital currency to facilitate illicit activity, financial institutions, including exchanges and other providers of digital currency services, must guard against the risks of assisting these malicious actors,” she said.


Over the last year, U.S. authorities have been taking active measures to deal with the menace of increasing malicious use of cryptocurrencies. Mandelker noted how the Financial Crimes Enforcement Network (FinCEN) is having a strict vigilance on crypto exchanges and other businesses operating in this space. 


Yesterday, Cryptoscanner reported that the U.S Department of Homeland Security has announced the development of sophisticated tools which can help them analyze the transactions done using privacy coins. The department said that unreasonable level of anonymity provided by a few crypto projects provides a platform for illicit transactions. 

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