Mnuchin Says Guidelines Move Crypto Firms From ‘Dark Shadows’
Mnuchin Says Guidelines Move Crypto Firms From ‘Dark Shadows’
(Bloomberg) -- Treasury Secretary Steven Mnuchin voiced his support for new global regulatory standards to combat illicit financing by criminals, terrorists and rogue nations that will have major implications in the world of cryptocurrencies.
Mnuchin spoke Friday at an Orlando, Florida gathering of the Financial Action Task Force -- a multi-government effort that develops recommendations for combating money laundering and financing of terrorism that’s comprised of about 200 countries. The guidelines require companies to collect information about customers and the recipients of funds, and to send that data to the receiver’s service provider with each transaction.
“By adopting the standards and guidelines agreed to this week, the FATF will make sure that virtual asset service providers do not operate in the dark shadows,” Mnuchin said. “This will enable the emerging FinTech sector to stay one-step ahead of rogue regimes and sympathizers of illicit causes searching for avenues to raise and transfer funds without detection.”
Many crypto industry participants aren’t equipped to collect and send the data now required. The rules will require collaboration between the world’s 200-plus crypto exchanges, many of which operate purposely in lightly regulated jurisdictions such as the Caribbean.
The FATF, which is currently headed by a representative from the U.S., will conduct a review of how countries subject to its rules are implementing the requirements in June 2020. Lack of compliance could lead to the closing of exchanges and penalties.
Mnuchin noted that he created a working group with the Federal Reserve and other regulators to make sure cryptocurrencies are only used in legitimate ways. "We will not allow cryptocurrency to become the equivalent of secret numbered accounts," he said.
To contact the reporters on this story: Olga Kharif in Portland at okharif@bloomberg.net;Saleha Mohsin in Washington at smohsin2@bloomberg.net
To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Dave Liedtka, Rita Nazareth
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