The United States Department of the Treasury Under Secretary for Terrorism and Financial Intelligence Sigal Mandelker asked crypto industry movers and shakers to do their part in preventing the illegal use of cryptocurrencies.
In a speech at the Financial Crimes Enforcement Conference, Mandelker spoke about the issue of mitigating risks linked to nascent technologies, including digital currencies, which could possible be used for reprehensible goals.
Mandelker emphasized that financial institutions and cryptocurrency services providers must battle illicit activity and the risks of aiding bad actors.
“The digital currency industry must harden its networks and undertake the steps necessary to prevent illicit actors from exploiting its services,” she stated.
Mandelker also urged foreign regulators to bolster anti-money laundering (AML) and Combating the Financing of Terrorism (CFT) frameworks when it comes to digital currencies. In addition, the Mandelker underlined the significance of supervision and enforcement of AML and sanctions obligations.
“The lack of AML/CFT regulation of virtual currency exchangers, hosted wallets, and other providers — and, indeed, of the broader digital asset ecosystem — across jurisdictions exacerbates the associated money laundering and other illicit financing risks.”
The call to action came after a new approach that the agency undertook last week to hone in on illicit actors, who deployed cryptocurrencies and other new technologies to launder and move ill-gotten resources. The cyber criminals supposedly utilized malware called “SamSam,” that impacted more than 200 victims, including state organizations and public institutions.
“As part of this scheme, two Iranian financial facilitators helped exchange the Bitcoin ransom payments into Iranian rial for the hackers. Last week, those two financial facilitators found themselves on OFAC’s Specially Designated Nationals and Blocked Person’s (SDN) list. For the first time ever, OFAC attributed digital currency addresses associated with designated individuals,” Mandelker remarked.
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