The Week Of: October 12, 2020
This week’s news and stories of interest to the AML community.
DOJ releases cryptocurrency enforcement report
The US Department of Justice’s Cyber-Digital Task Force published a report last week titled “Cryptocurrency: An Enforcement Framework.” It says crypto is an important new technology but is currently being used by criminals for illicit ends; law enforcement needs to adapt strategy and tools for 21st century financing.
The 83-page report is broken down into three parts. Part I provides a detailed threat overview that highlights the three most common illicit uses of cryptocurrencies. Part II looks at current legal and regulatory tools used to combat these illicit uses. Finally, Part III concludes the report with a discussion of the ongoing challenges the government faces with enforcement.
“Cryptocurrency is a technology that could fundamentally transform how human beings interact, and how we organize society,” said Attorney General William P. Barr. “Ensuring that use of this technology is safe, and does not imperil our public safety or our national security, is vitally important to America and its allies.”
European lawmakers call for stronger oversight in wake of FinCEN Files
The FinCEN Files have illustrated the vast scale of the European Union’s money laundering problem, according to Dubravka Šuica, vice president of the European Commission for Democracy and Demography, who said that individual member countries are “not up to the task” of addressing global criminal networks by acting alone.
During a session of Parliament last week, several members called for a centralized framework to better combat the problem.
Eero Heinäluoma, treasurer for the Progressive Alliance of Socialists and Democrats in the European Parliament, said current anti–money laundering efforts are like a “Swiss cheese full of holes” and called for a “uniform regulatory framework.’’
“Despite these alarms, banks still often execute these transactions. And again, it’s thanks to the great work of … journalists that the scandal is revealed,” he said. “It demonstrates once again that the existing money laundering system simply does not work.”
The publication of the FinCEN Files revealed how banks move trillions of dollars in transactions they have reported as potentially related to the actions of criminal and terrorist networks.
Almost half of UK bank specialists can’t spot signs of human trafficking among transactions
A study by BAE Systems has found that two in five UK professionals working in AML roles across the financial, business, banking and insurance industries are not confident they can identify the signs of human trafficking among their customers’ transactions.
Even if they do spot signs, only one in five believe they can stop the transactions, or the behavior involved in trafficking, the report suggests.
The study also found that 80 percent of professionals are concerned that money laundering is currently happening in their customers’ transactions, and more than one in 10 financial institutions don’t even have an AML strategy in place despite it being a legal requirement.
AML/CFT software that profiles financial transactions and branch staff trained to spot potential at-risk customers can help build an accurate picture to help uncover human trafficking. However, this study shows that there is still much work to do.