INTERPOL calls for clear AML/CFT regulation of Virtual Asset Service Providers
Following the fourth edition of the Global Conference on Criminal Finances and Cryptocurrencies, INTERPOL, EUROPOL and Basel Institute on Governance have outlined a set of recommendations.
All member countries/states are encouraged to establish clear regulatory frameworks and processes to support the registration and AML/CFT supervision of Virtual Asset Service Providers (VASPs) such as cryptocurrency exchanges, custodial wallet providers and other entities that issue or transmit VAs, in line with the Financial Action Task Force (FATF) Recommendations.
VASPs should be regulated in the same manner as other financial intermediaries and should contribute to the global efforts towards AML/CFT by implementing compliance programs, risk-based due diligence, reporting, etc.
Finally, VASPs should be obliged subjects under the AML/CFT regulations to report suspicious transaction reports and carry out enhanced due diligence on customers and their transactions.
INTERPOL notes that recent increases in the number and quality of investigations in the field of cryptocurrency-facilitated crime and subsequent money laundering means that law enforcement and other public entities are continuing to enhance their level of knowledge and expertise in this crime area. In this regard, the conference served as an opportunity to underline the need for countries and jurisdictions to increase the exchange of tactical information and best practices.
Let’s note that, for example, in the UK, the Financial Conduct Authority (FCA) is the anti-money laundering and counter-terrorist financing (AML/CTF) supervisor of UK cryptoasset businesses under the MLRs.
From January 10, 2020, existing businesses (operating before 10 January 2020) carrying on cryptoasset activity in the UK have needed to be compliant with the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, as amended (MLRs) and need to register with the FCA.
New businesses (that began operating after 10 January 2020) must register with the FCA before they begin conducting business. The FCA encourages all businesses to apply for registration as soon as possible.