Colombian Money Laundering Watchdog Delays Crypto Transaction Reporting Regime

  • Richard Marley
  • April 06, 2022
  • 3 minutes read
  • 2085

The UIAF has postponed the date for crypto exchanges and individuals to start reporting their transactions to the Colombian money-laundering watchdog.

The UIAF will now initiate a consultation phase that will gather companies and individuals to present their thoughts about the proposed regulations, which are subject to amendments before it is applicable on June 1st.

The Colombian money-laundering watchdog is the organization that establishes controls for the detection and prevention of money laundering and terrorism financing in Colombia. 

The real reasons behind the delay were not specified in the document, but the new resolution that establishes the postponement states:

“In order to ensure that the submission of reports to the UIAF is complete and meets the information needs of the entity, the need to extend the reporting start date was considered.”

The new regulations also state that the organizations that have already sent in their reports can still send them in a voluntary manner, but that no fines will be imposed for not sending them before June 1st. In this way, companies will have more time to adapt to the rule that was established in December 2021 with resolution 314, while the organization receives commentary from different groups on the issue.

The UIAF considered the need of overseeing cryptocurrency transactions in Resolution 314, that established subjects must report single transactions whose value goes over $150, or groups of transactions whose value goes over $450. For the purpose of this, the Colombian organization stated that:

“Virtual assets have created a situation that merits the intervention of the UIAF, to the extent that, although they are operations that in Colombia are not illegal by themselves, they can lend themselves to illicit activities, due to the anonymity or pseudonymity in the transactions, the absence of support from the central bank and the non-recognition as an instrument that has liberating power.”

However, this resolution has faced heavy criticism from several crypto-related personalities in the country, who oppose the huge volume of data that will have to be delivered to the institution. Among these is Alejandro Beltran, country manager for Colombia, who stated:

“Reporting from USD $150 would contemplate a large volume of transactions, and the other associated data goes far beyond even the information that the exchanges themselves can handle about the operations.”

Suggested read: Crypto Providers at Risk of Money Laundering & Terror Financing, Says FMA