Cryptocurrencies marked as top AML and CFT Priority by FinCEN

  • Richard Marley
  • July 02, 2021
  • 2 minutes read
  • 86

FinCEN will soon be publishing regulations on how financial institutions can incorporate cryptocurrency controls in their AML programs. 

The Financial Crimes Enforcement Network (FinCEN) has stated that it will continue to prioritize monitoring of the cryptocurrency industry to combat crimes such as money laundering. 

In an official announcement on Thursday, FinCEN stated that “virtual currency considerations” and transactions that involve cryptocurrencies such as Bitcoin (BTC) will be a national priority for countering terrorism financing and ensuring adequate anti-money laundering policies.

The regulatory body stated that these priorities will assist financial institutions in making sufficient efforts for combating crime under related laws. FinCEN elaborated that new regulations will also be issued soon regarding how financial institutions can incorporate these priorities into their AML programs.  

The authority further added that not every priority will be applicable to every institution, but every institution should incorporate these priorities, where due, in their risk-based AML program. 

FinCEN referred to cryptocurrencies as “convertible virtual currencies (CVCs)”, and pointed out that such assets facilitate a high amount of illicit activity. CVC uses by criminals were also listed down, where the FinCEN argued that it is a “preferred form of payment” for purchasing illegal goods like ransomware tools or even advancing activities like “nuclear weapons ambitions.”

FinCEN gave the example of North Korean-linked cyber actors that likely stole “millions of dollars worth of CVCs since 2019 via cyber operations, laundered stolen CVC through other CVC service providers and wallets, and used the proceeds to help fund weapons of mass destruction and ballistic missile programs”

Suggested Read: Dirty Funds & Tax Evasion – Can the Crypto Sector Be Safeguarded?