Crypto & Blockchain News

FATF Calls for Implementation of “Travel Rule” to Combat Cryptocurrency Enabled Money Laundering


The Financial Action Task Force (FATF) has issued a new call for countries to implement “travel rules” as part of efforts to combat cryptocurrency-enabled money laundering and terrorism financing. The FATF emphasizes the need for swift action to close regulatory loopholes.

The Financial Action Task Force (FATF), an international body focused on combating money laundering and the financing of terrorism, has urged countries to implement “travel rules” to deal with illicit activities facilitated by cryptocurrencies. In its recent statement, the FATF highlighted the need for more progress to be made by member states in implementing this rule.

According to the FATF, “more than half” of respondents to the survey said they had taken no action to implement the Travel Rule, a critical requirement for preventing the transfer of funds to sanctioned individuals or entities. This failure to act allowed criminals to exploit significant regulatory loopholes.

The FATF has stressed the urgent need for countries to swiftly implement anti-money laundering (AML) and counter-terrorism financing (CTF) measures with respect to crypto-related activities. This is critical in preventing criminals from taking advantage of the unregulated aspects of the cryptocurrency space.

In a survey conducted in March 2022, the FATF found that only 29 out of 98 jurisdictions met the requirements set by travel rules. Enforcement of these requirements is even more limited, with only a minority of jurisdictions taking action.

The travel rules, introduced by the FATF in June 2019 and last updated in June 2022, address the anonymity of illegal cryptocurrency transactions. In their last meeting, FATF members agreed to further update the rules.

The FATF announced the release of the report on June 27, urging member states to implement its recommendations to close regulatory loopholes exploited by criminals. The report will also highlight North Korea’s alleged involvement in illegal virtual asset activities, where stolen funds were reportedly funneled into the country’s Weapons of Mass Destruction program.

Additionally, this report will discuss emerging risks associated with stablecoins, decentralized finance, non-fungible tokens (NFTs), and peer-to-peer transactions, highlighting the need for regulatory action to address potential avenues for these illicit activities.

The FATF’s call to implement “travel rules” underscores the importance of regulatory measures to combat cryptocurrency-enabled money laundering.


Source link

Related Articles

Back to top button