A US Treasury official says rooting out illicit financing by crypto industry players will require additional tools and resources.
In his written testimony before a House Financial Services Committee hearing, Brian Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence (TFI), says published risk assessments of virtual assets show that threat actors, including ransomware cybercriminals, North Korean cyber actors, scammers and terrorist groups misuse cryptocurrencies.
He says bad actors are using crypto assets to profit from illegal activities by exploiting vulnerabilities such as jurisdictional arbitrage and the inability of financial institutions to meet their anti-money laundering and countering the financing of terrorism (AML) obligations. /CFT).
Nelson explains how the TFI is tackling these challenges.
“[W]We have tools in place to address some of these vulnerabilities, such as using our authorities to hold accountable companies that fail to comply with their Bank Secrecy Act and sanctions obligations.
We also use our tools, sometimes in new ways, to disrupt the ability of illegal actors to use virtual assets.”
However, Nelson says evolving threats now require better tools and resources to effectively tackle illegal transactions in the crypto space.
“[T]o eradicate illegal financing by players in virtual asset markets and forums, we need additional tools and resources. That’s why we’re committed to working with Congress to enact common-sense reforms that modernize our tools and authorities so they can meet the evolving challenges we face today.”
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