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A new edition of the FATF guidelines to combat money laundering and the financing of terrorism

The regulation was in the year 2018 a major point of discussion in the field of crypto-currency, mainly as a result of the monumental Kryptowahns in the year 20

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A new edition of the FATF guidelines to combat money laundering and the financing of terrorism

The regulation was in the year 2018 a major point of discussion in the field of crypto-currency, mainly as a result of the monumental Kryptowahns in the year 2017.

This is entered in Europe in the foreground, after the Financial Action Task Force (FATF) had updated in October their policy on crypto-currencies, which was originally introduced in the year 2015.

to understand the impact of these revised guidelines, it is necessary to understand the role of the FATF and its involvement in the regulation of crypto-currencies.

FATF and crypto

in 1989, the G7 established the FATF is for the creation of the legal, regulatory and operational measures for the prevention of money laundering in Europe and worldwide. Since its creation, the FATF has developed a series of recommendations, which are considered the international Standard for combating money laundering and the financing of criminal activities.

A massive rush of investors who want to enter by trading crypto currencies on exchanges around the world, a commitment that has led governments and financial authorities must establish a clear legal framework and guidelines for the personnel working in this area.

of Course, this has assumed in different regions of the world, different shapes and colors. In countries such as China have strict, crypto-free behavior, while a Nation such as Malta, the pro-crypto has taken the attitude that could make it a leading destination for crypto and Blockchain - companies.

In this context, based on the FATF organization in 2015 a "risk" for crypto-currencies issued which should help the countries to develop regulatory processes to control the potential risk of the use of cryptocurrencies for money laundering and terrorist financing.

Currently, 35 countries are members of the FATF, many of which are considered to be financial centres around the world.

The European countries make up a large percentage of the member States, including the UK, Turkey, Switzerland, Sweden, Spain, Norway, the Netherlands, Luxembourg, Italy, Ireland, Iceland, Greece, Germany, France, Finland, Denmark, Belgium and Austria.

Against this Background, the recommendations of the FATF to regulate crypto-currencies to address AML concerns are particularly important for the continent.

demands for clarity in Europe

Since October 2018, the FATF has made some Changes to their original recommendations, which relate to financial activities in connection with crypto-currencies. This was Essentially the answer to the call for clarity about which activities the FATF guidelines apply.

In terms of crypto, the FATF rules with respect to a risk-based response to money laundering (Anti-Money Laundry - AML) and combating the financing of terrorism (Counter - Financing of Terrorism-CFT) were changed currencies in order to eliminate concerns regarding the use of financial activities of the crypto-currency.

By exchanges, Wallet providers, and providers of financial services to ICOs, it is expected that they are subject to the provisions of the AML / CFT. This should be done through licensing, registration or Monitoring of these entities, to ensure that the existing provisions are complied with.

This follows similar policies implemented in South Korea, where an anonymous trade was banned and stricter guidelines for exchanges have been introduced, including the use of AML / CFT and Know-your-customer (Know Your Customer - KYC) requirements.

at the end of October, the state financial monitoring service of Russia called on the members of the FATF, these Changes to implement. The Russian service plans to introduce rules for the control of Crypto-transactions of 600,000 rubles or more (approximately 8,000 euros).

In the Russian context there are no official rules for the use of, and trade with crypto currencies, although a draft law is in preparation.

This seems to back the FATF recommendations, seemingly in the right perspective, since you seem to be the only real Standard, to the various countries, resort to crypto-currencies to deal in a broad perspective.

Just a day before the FATF published its latest recommendations, published by the Switzerland-based Capital Markets and Technology Association (CMTA) your own updated AML Standards for digital Assets and Distributed Ledger technologies (DLT).

In this document, Compliance-Standards for virtual Asset issuers, guidelines for the classification of Initial Coin Offerings (ICOs), as well as instructions for banks, securities dealers and other financial institutions that want to participate in crypto-currencies or Blockchain-based projects.

In September, it was published in a Belgian report, in which it was required to regulate crypto-currencies and ICOs at the European level. These were directed to manage potential risks and to develop the use of the Blockchain technology.

The European Union has already made it clear that they will work in the next 12 months on the classification and management of crypto-currencies, the Vice-President of the European Commission, Valdis Dombrovskis. A pressing concern is re-laundering the risk of money and fraud.

these are the risks - crypto - task force of the UK

While the FATF has provided General guidance for the international community, has made the UK his own homework in this sector - coming, that she is a member of the FATF.

In March 2018, a cryptographic task force was set up by the Ministry of Finance, the Financial Conduct Authority and the Bank of England. This has led to a final report, which was published at the end of October.

the report says that Blockchain technology, which is referred to in the report as a Distributed Ledger technology that offers several advantages. There is an air of negativity and skepticism about crypto, however, remains currencies:

"There is only limited evidence that the current Generation of cryptographic benefits, but this is a rapidly developing market, which could bring in future benefits. Crypto-potential significant risks are connected to currencies, and the top priorities for the authorities in the mitigation of risks to consumers, market integrity and the prevention of the use of crypto-currencies for illegal activities.“

The Breport recommends that crypto-currencies, which correspond to the Standards of the existing rules, as such, must be treated.

Newer crypto-currencies, the older financial regulations are the challenges that require international coordination, to ensure that you will be treated accordingly.

These recommendations have also been received with some skepticism. In a report the proposed regulations have been referred to as a "blunt Instrument". In the preparation of the report, the companies involved pointed out that a more complicated approach could hinder the development of crypto-currencies, and various Fintech companies actually.

patience game

The current guidelines of the FATF are non-binding. They serve mainly as an Advisory Parameter for regulatory authorities and governments to follow to their respective locations and crypto-currency transactions.

Marshall Billingslea, President of the FATF, announced in connection with the October updated version of its recommendations, the plans to publish by June 2019 government rules for the crypto industry, according to Reuters.

Some European countries have set their own rules and regulations for cryptocurrencies, Wallet providers, and other affiliated companies.

Nevertheless, the member States have no regulation of trading in crypto currency can get in the next year, a statement of the FATF.

Cointelegraph sat down with the FATF and received at the time of publication no formal response.

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