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Crackdown On Cryptocurrencies Launched By Global Money-Laundering Watchdog

Crackdown On Cryptocurrencies Launched By Global Money-Laundering Watchdog
The Financial Action Task Force (FATF) - a global watchdog, rules would be created to govern cryptocurrency companies so that there is a reduction in the incidents of misuse of digital coins such as bitcoin for the purpose of money laundering. This would be the first effort globally at bringing the rapidly growing cryptocurrency sector under some form of regulatory framework. 
The FATF was set up to fight against money laundering about 30 years ago. The agency has asked various countries to set in right regulations for oversight of cryptocurrency exchanges so that there is a halt to the u of such digital coins for money laundering efforts.
A wide range of countries – from the United States to China, as well as bodies such as the European Commission, are part of the FATF. This effort by the agency is clearly reflective of the increasing anxiety of international law enforcement agencies about the use of cryptocurrencies for transferring of money generated from crimes.
The move by FATF would mandate that cryptocurrency-related firms such as exchanges and custodians be registered and supervised by countries, the FATF said in a statement, and added that the members of the agency would also have to conduct detailed customer checks and report back any form of suspicious transactions and activities involving cryptocurrencies.
“This will enable the emerging FinTech sector to stay one-step ahead of rogue regimes and sympathizers of illicit causes searching for avenues to raise and transfer funds without detection,” U.S. Treasury Secretary Steven Mnuchin told a FATF meeting in Florida, according to remarks posted on the U.S Treasury website.
In a recent interview to the news agency Reuters, Simon Riondet, head of financial intelligence at Europol, the European police agency that coordinates cross-border investigations, opined that he believes that there is a increased use of cryptocurrencies for purposes of illegal money transfers.
“This is a risk we all face worldwide,” FATF President Marshall Billingslea told the media. “Nations need to move forward rapidly. This is an urgent issue.”
Earlier this year, a Spanish drugs cartel was debugged by the Europol. The cartel was engaged in money laundering through two crypto ATMs, machines which exchange cryptocurrencies for cash.
Criminals and cartels use cryptocururency for breaking into small parts large amounts of illegally generated money for ease of transferring as well as for transferring of illegal money across borders, Riondet said. “We also have some investigation on the dark web in which the payments are made in cryptocurrencies, sometimes in bitcoin, and they are switching it to more anonymized cryptocurrencies,” he said.
The move by the FATF is the first such initiative globally to establish a universal approach to creating a framework for regulating the global cryptocurrency trading market which is valued at about $300 billion. The move also aims to add on to the current regulations that are only available in patches and which are varied – such as China banning crypto exchanges altogether while Japan moving ot provide then licenses to be regulated.

Christopher J. Mitchell

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