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FATF Urges Adoption of Crypto Travel Rule to Combat Financial Crimes

FATF Urges Adoption of Crypto Travel Rule to Combat Financial Crimes

The Financial Action Task Force (FATF), a United Nations organization, is calling on countries worldwide to implement the “travel rule” to address money laundering and terrorism financing involving cryptocurrencies.

In a recent development, the FATF expressed concerns about member states not implementing the travel rule. This announcement follows a series of meetings held at the organization’s headquarters in Paris.

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FATF Urges Adoption of Crypto Travel Rule to Combat Financial Crimes
21 June 2023 : Réunion plénière du GAFI du 21 Juin 2023
OECD Headquarters, Paris

According to FATF, more than half of the survey respondents have not taken any steps to implement the travel rule, which is crucial in preventing funds from being transferred to sanctioned individuals or entities.

The FATF is urging nations to quickly adopt measures against money laundering and terrorism financing related to cryptocurrency activities to prevent criminals from exploiting unregulated areas.

A survey conducted by the FATF in March 2022 revealed that out of 98 jurisdictions evaluated, only 29 met the criteria outlined in the travel rules, and enforcement efforts were limited.

The FATF travel rule aims to address the anonymity associated with illicit cryptocurrency transactions and was introduced in June 2019. It underwent its latest revision in June 2022, with further updates agreed upon during the meetings.

On June 27, the FATF announced its plan to release a report stressing the importance of member countries following its recommendations. The goal is to effectively tackle and eliminate existing vulnerabilities exploited by criminals.

The upcoming report will highlight North Korea’s alleged involvement in illicit virtual asset activities, including channeling stolen funds into its Weapons of Mass Destruction program.

Furthermore, the report will examine other “emerging risks” such as stablecoins, decentralized finance, non-fungible tokens, and peer-to-peer transactions, shedding light on their illicit activities.

Compiled by Coinbold


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