The United Kingdom implements new Anti-Money Laundering regulations
The United Kingdom’s finance and economics department has announced the incorporation of new Anti-Money Laundering (AML) regulations. The extra measures would diminish the chances of money laundering and other crypto-related crimes, according to the UK Finance and Economics Department. In a speech on March 6, the Director of Retail and Regulatory Investigations, Therese Chambers, stated that the new Money Laundering Regulations places the UK’s Financial Conduct Authority (FCA) as the Anti-Money Laundering supervisor for some crypto aims.
Storm-7 Consulting tweeted regarding the news:
The UK Finance and Economics Department said the additional measures put in place would reduce the risk of laundering and other crypto-related crimes. https://t.co/qTcSXIDXyP
— Storm-7 Consulting (@Storm_7_Consult) March 11, 2020
She further stated that the new regulations go beyond the 5th Anti-Money Laundering Directive (5AMLD) and encompass a wider set of activities, including initial coin offerings or ICOs, as advised by FATF the last year. The 5AMLD was implemented by the European Union last Summers and it was effectuated in January 2020.
According to Chambers, virtual currencies allow anonymous financial transfers. The FCA’s regulatory supervision mainly aims towards business dealings within the virtual space. The new regulations concern crypto exchanges that extend fiat pairings and deal in crypto pairings as well. Wallet service providers are also included. According to Pawel Kuskowski, the CEO of Coinfirm, the new regulations indicated that crypto can no longer be closed by banks.
FCA risk assessment, customer due diligence, transaction monitoring, record-keeping as well as suspicious activity reporting are some of the things that crypto firms should possess to conduct business. Many Crypto firms have started evacuating the United Kingdom and European Union due to their ongoing stringent regulations.
The EU passed new Anti-Money Laundering regulations in July 2018, called the 5th Anti-Money Laundering Directive (5AMLD). The 5AMLD regulations caused various crypto exchanges to leave UK and EU related countries. Two Crypto platforms, Simplecoin and Chopcoin, have closed down their services due to 5AMLD.
Simplecoin indicated that these requirements are against the fundamental motives of cryptocurrencies, such as privacy and decentralization.