UK Passes Crypto Bill, Allows Seizure of Crypto Before Arrest

UK Passes Crypto Bill, Allows Seizure of Crypto Before Arrest

The Economic Crime and Corporate Transparency Bill in the United Kingdom has progressed to its final stages of approval in the House of Lords. This bill, introduced in September 2022, primarily targets illicit cryptocurrency usage and aims to combat financial crimes related to cryptocurrencies. Over the past year, it has undergone multiple stages of review, moving from the House of Commons to the House of Lords.

During the House of Lords review, certain amendments were made to clarify the bill’s intent, particularly in targeting monetary proceeds from fraud and other financial crimes. Additionally, the bill includes provisions related to corporate transparency and the registration of overseas businesses.

The final step in the legislative process will involve the House of Commons, which will either accept the proposed amendments or suggest further changes to the bill. Once approved, the bill will become law through royal assent, a formal approval process by the monarch.

The Financial Conduct Authority (FCA), the UK’s financial regulator, has expressed its willingness to collaborate with cryptocurrency companies to develop a regulatory framework for the industry. FCA Executive Director Sarah Pritchard emphasized the importance of shaping rules and regulations to benefit markets, consumers, and firms as cryptocurrencies move from being a niche market to mainstream adoption. The FCA’s main responsibility is to ensure that crypto firms operating in the UK comply with Anti-Money Laundering and Counter-Terrorist Financing legislation.

The key aspect of the bill is its potential to empower law enforcement agencies to freeze and seize cryptocurrencies associated with criminal activities more efficiently. Currently, assets linked to criminal cases can only be seized if there is an arrest or conviction, allowing criminals to move their assets before they can be frozen. The bill removes the requirement for an arrest before confiscation and allows courts to order the confiscation of assets even before an arrest is made. This change is expected to significantly enhance law enforcement efforts in time-sensitive criminal investigations.

The bill also introduces civil forfeiture powers, enabling the seizure of crypto linked to crime, regardless of whether a person is convicted of criminal offenses. This provision aims to mitigate the risk posed by individuals who cannot be prosecuted but use their funds for criminal or terrorist purposes.

One of the bill’s potential benefits is the ability to prevent criminals from quickly moving flagged assets out of the UK’s jurisdiction. This could lead to faster asset freezes and, subsequently, more successful recoveries of digital assets tied to criminal activities. It is anticipated that the bill will lead to a substantial increase in the recovery of digital assets, potentially contributing significant funds to law enforcement efforts.

Data from the National Crime Agency estimated that illicit crypto transactions linked to the UK amounted to approximately £1.24 billion ($1.53 billion) in 2021. The funds recovered from seized crypto assets could be allocated to law enforcement agencies or used to fund economic crime prevention measures.

However, some experts caution that as the UK becomes more proficient at seizing crypto assets, criminals may transfer their assets to less regulated jurisdictions, posing new challenges for law enforcement agencies.

In summary, the Economic Crime and Corporate Transparency Bill in the UK is nearing its final approval stages, with the potential to enhance the authorities’ ability to combat cryptocurrency-related financial crimes and recover assets linked to illicit activities. The bill’s provisions could lead to faster asset freezes and contribute funds to law enforcement efforts, although challenges may arise if criminals seek refuge in less regulated jurisdictions.

* Original content written by Coinlive. Coinbold is licensed to distribute this content by Coinlive.

Coinlive is a media company that focuses on Making Blockchain Simpler for everyone. We cover exclusive interviews, host events, and feature original articles on our platforms


Latest news

Upcoming Events