Tuesday, February 27, 2024

Crypto Travel Rule implementation ‘remains relatively poor,’ says FATF


A renewed name from the Monetary Motion Process Power has requested international locations to implement the “Journey Rule” to fight cash laundering and terrorism financing actions enabled by cryptocurrencies.

On June 23, the United Nations physique — whose function is to advertise methods to fight cash laundering and terrorist financing — explained that “many” member states have did not implement the rule.

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The decision comes after a sequence of FATF conferences at its headquarters in Paris.

FATF claimed “greater than half” of respondents in a survey mentioned that they had taken no motion to implement the rule:

“Greater than half of survey respondents haven’t taken any steps in direction of implementing the Journey Rule, a key FATF requirement to stop funds being transferred to sanctioned people or entities.”

FATF urged international locations to implement Anti-Money Laundering and Counter-Terrorism Financing measures on crypto-related actions “immediately” to stop “criminals” from exploiting “vital loopholes” not protected by regulation.

A March 2022 survey by FAFT discovered solely 29 of 98 jurisdictions on the time handed the necessities wanted as a part of the journey guidelines and a small subset of those jurisdictions had began enforcement.

The FAFT travel rule was carried out to focus on the anonymity of unlawful cryptocurrency transactions. It was launched in June 2019 and final updated in June 2022. An additional replace of the foundations was agreed to by FATF members on the conferences.

FAFT mentioned it could publish a report on June 27 calling on member international locations to implement its suggestions so as to shut the loopholes which it says criminals look to use.

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The report will make point out of North Korea’s illicit virtual asset activities, the place stolen funds are then allegedly funneled into its Weapons of Mass Destruction program, FAFT mentioned.

Illicit actions from different “rising dangers,” equivalent to stablecoins, decentralized finance, nonfungible tokens and peer-to-peer transactions, may even be mentioned within the report, it added.

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