Deputy head of the office of counter-terrorism and financial intelligence of the U.S. Treasury Department called on the international community for greater regulation of cryptocurrency for national security and for the protection of the financial system.
Referring to the recent establishment of the state of cryptocurrency Venezuela Petro
as an example, Mandelker Sigal (Sigal Mandelker) said at a conference of the Association of securities and financial markets, dedicated to the fight against money laundering and financial crimes that the totalitarian regimes, terrorists and other criminals use crypto currencies for «malicious use of the financial system», «hide the income earned by dishonest means» and «funding their illegal activities».
Mandelker also noted the lack of consistent international regulation of the cryptocurrency operators in respect of anti money laundering (AML) and combating the financing of terrorism (CFT). She said
«The lack of regulation in the sphere of AML/CFT for providers of virtual currencies throughout the world greatly exacerbates the risk of funding illicit activities with the help of cryptocurrency. Currently, we are one of the main countries in the world, along with Japan and Australia that govern their work to ensure compliance with the rules of AML/CFT. Other States should follow our example and make it a priority».
Mandelker also warned that a fine of $ 110 million, which was imposed on the exchange BTC-e last year for refusing to register as companies engaged in remittances, evidence of the willingness of the Ministry of the United States to conduct an aggressive policy.
«The company has not implemented any of the basic measures to control the use of their services for illegal actions,» she said. «As a result, they have become one of the main venues by which cyber criminals around the world launder proceeds of their illegal activities, thus contributing to the implementation of the crime, such as hacking and extortion, fraud, identity theft, tax evasion, corruption and drug trafficking.»
Mandelker urged regulators to «increase» their efforts to prevent financial crime and protect national security. She also stated that the companies «themselves need to take more measures» on struggle against money-laundering and the financing of terrorism in countries without or with insufficient regulation.
«You play a key role in countering the threats that we face,» said she, turning to cryptocurrency exchanges. «Bar that you set for your customers, counterparties, is crucial to ensure transparency of the international financial system and of removing it from the fraud.»