FinCEN Says It Now Receives 1,500 Crypto Complaints a Month

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The Financial Crimes Enforcement Network receives more than 1, 500 reports each month from financial institutions seeing cryptocurrencies, a top official said Thursday. Kenneth Blanco, FinCEN Director, speaking at the Chicago Kent Block Tech Conference, discussed the role his agency takes in regulating cryptocurrencies. He noticed that although cryptocurrencies can prove beneficial for specific use cases, they also create opportunities for poor participants like financial criminals, terrorists and rogue states. Blanco highlighted the importance of the suspicious activity report filings – a sort of document that financial institutions must file following a suspected incident of cash laundering or fraud. FinCEN receives more than 1, 500 SARs each month seeing questionable activities involving cryptocurrency transactions, he said.

These reports come from traditional financial institutions and cryptocurrency exchanges, he said. He said: It had been filings by the two banks as well as other virtual currency exchanges that supplied critical leads for law enforcement. This info included beneficial ownership info, additional action attributed to the market of that we were previously unaware, jurisdictional info, and also additional financial institutions that we could contact for leads. All this was accessed through SARs as well as the supporting documents submitted by the financial institutions.” . Blanco also discussed FinCEN’s part in the crypto area more broadly, explaining that the regulator has worked for decades in the cryptocurrency field, with a concentrate on exchanges, administrators along with other persons involved with money transmission related to cryptocurrencies.

He warranted the agency’s legal status in the field by imagining that cryptocurrencies behaving as a replacement for fiat currency are insured with a 2011 principle FinCEN issued concerning money service companies that provide money transmission services. Additionally, Blanco noted that the agency has been working closely with some other regulators, such as the U.S. Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission on policy development and regulatory procedures related to cryptocurrency. Blanco referenced first coin offerings throughout his remarks, noting that this rapidly growing area has accumulated a lot of latest public attention. He especially cited the fraud around the fundraising method as a domain of focus.

He continued: Even though ICO arrangements vary and, dependant upon their structure, could be subject to different authorities, one reality remains absolute: FinCEN, and our partners in the SEC and CFTC, anticipate businesses involved with ICOs to meet all their obligations. We stay committed to taking appropriate action when these obligations aren’t guaranteed, and also the U.S. Monetary system is put in danger.” . Kenneth Blanco image through the U.S. Government / Flickr. The leader in blockchain news, CoinDesk is a media outlet that strives for the greatest journalistic standards and adheres to a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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