FATF Warns Many Countries Continue to Face Challenges in Meeting Virtual Asset Regulations
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Approximately 75% of FATF member countries fail to adhere to or only partially comply with Recommendation 15, which concerns virtual asset service providers (VASPs).
Virtual assets and virtual asset-based service providers (VASPs) present anti-money laundering (AML) risks that countries should better understand. To mitigate these risks, they are encouraged to implement Recommendation 15 immediately.
More than half of the jurisdictions in a recent FATF survey have not even begun implementing the travel rule, which the FATF describes as a “serious concern.” In its report, it is stated that jurisdictions must act urgently to implement and enforce recommendation 15.
According to the report, the travel rule requires VASPs to share information about the originator, beneficiary, and transactions in virtual assets. The FATF, however, emphasises that there is room for improvement in the interoperability between solutions and across jurisdictions.
The FATF has adopted an implementation roadmap to improve the implementation of Recommendation 15. The FATF will provide outreach and assistance to jurisdictions with low capacity; identify and publish jurisdictions’ steps to implement recommendations for materially significant VASP activities; facilitate the exchange of experiences, challenges, market trends; and keep members informed about progress. FATF will further review progress and challenges to ensure implementation by June 2024.
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