FinCEN Says It Today Receives 1,500 Crypto Complaints That a Month
Blanco also discussed FinCEN’s part at the crypto area more widely, describing that the regulator has worked for years in the cryptocurrency field, with a focus on”exchanges, administrators and other persons involved with money transmission” related to cryptocurrencies.
Blanco highlighted the value of Suspicious Activity Report (SAR) filings — a kind of document that financial institutions must file following a suspected episode of money laundering or fraud. FinCEN receives over 1,500 SARs every month regarding suspicious activities involving cryptocurrency trades, he said.
He justified the agency’s legal standing in the field by noting that cryptocurrencies acting as a substitute for fiat monies are insured with a 2011 principle FinCEN issued concerning money service companies that provide money transmission services.
“It was filings by the two banks and other virtual money exchanges that provided crucial outcomes for law enforcement. This information contained beneficial ownership information, additional activity attributed to the exchange of that we have been previously unaware, jurisdictional information, and extra financial institutions we can contact for leads. All of this was acquired through SARs and the supportive records filed by financial institutions”
These reports come from both traditional monetary institutions and cryptocurrency markets,” he said.
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FinCEN manager Kenneth Blanco, talking at the Chicago-Kent Block (Legal) Tech Conference, discussed the function his bureau takes in regulating cryptocurrencies. He noted that although cryptocurrencies can prove beneficial for particular use cases, they also generate opportunities for bad actors like financial criminals, terrorists and rogue states.
Kenneth Blanco image through the U.S. Government / Flickr
Blanco referenced first coin supplies (ICOs) during his comments, noting that”this rapidly growing region has gained a great deal of recent public attention.” He especially cited fraud around the fundraising method as an area of attention.
The Financial Crimes Enforcement Network (FinCEN) receives over 1,500 reports every month from financial institutions seeing cryptocurrencies, a top official said Thursday.
“While ICO arrangements differ and, depending on their arrangement, may be subject to distinct authorities, one truth remains intact: FinCEN, and our partners at the SEC and CFTC, expect companies involved in ICOs to meet all of their [anti-money laundering/combating the financing of terrorism] responsibilities. We remain committed to taking appropriate action when these duties are not guaranteed, and also the U.S. monetary system is put at risk.”