FATF Urges Implementation Of Travel Rule To Combat Cryptocurrency-related Crime

The United Nations Financial Action Task Force (FATF) has once again called on countries to implement the “travel rule” to combat money laundering and terrorism financing associated with cryptocurrencies.

“We are disappointed that “many” of our member states have not adopted the rule, despite holding meetings in Paris. A survey conducted by the FATF revealed that over half of the respondents have taken no action to implement the Travel Rule, which is a crucial requirement,” said the global body in a recent post. 

In response, the FATF is urging countries to promptly introduce measures to address anti-money laundering and counter-terrorism financing related to crypto activities. They aim to close significant loopholes that have enabled criminal behavior.

“The travel rule, also known as FATF Recommendation 16, consists of guidelines aimed at combating money laundering and terrorist financing. It mandates the identification of individuals involved in cryptocurrency transactions to verify their identities and detect potential criminal activity,”said FATF.

The rule applies to financial institutions and crypto firms involved in the transfer of virtual assets, collectively referred to as VASPs.The FATF survey in March 2022, which revealed that only 29 out of 98 jurisdictions had implemented the Travel Rule requirements, with few enforcing penalties for non-compliance. The upcoming FATF report, to be published on June 27, will also address North Korea’s alleged illicit virtual asset activities and consider other emerging risks such as decentralized finance, non-fungible tokens (NFTs), stablecoins, and peer-to-peer transactions.

“Bitcoin was trading at $30,207 at the time of writing, showing a 1.61% decrease in the last 24 hours,” said Benzinga.

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