FinCEN Indirectly Calls Out The Facebook Led Libra Stablecoin For AML Practices
- Jamal El Hindi emphasized on the need for upcoming digital assets related companies to conform to current set standards that apply to Financial institutions
- Each company will be held accountable for how they prioritized ridding their platforms of financial crimes
During the SIFMA 20th Anti-Money Laundering (AML) and Financial Crimes conference held in New York, Jamal El-Hindi the deputy director of the Financial Crimes Enforcement Network (FinCEN) urged social media and messaging platforms that intend to incorporate cryptocurrencies to their platforms to be accorded the same regulatory treatment that other financial institutions already in operation have. This would push them to be on the lookout for potential loopholes that may enable illicit transactions.
He emphasized that social media platforms that have now prioritized launching their own cryptocurrencies cannot afford to ignore the probability of their platforms being used to carry out illegal dealings. He added that as a financial watchdog they wouldn’t allow standards that they worked so hard to incorporate in the financial systems backsliding due to some of the emerging technologies.
“Let me take this opportunity to emphasize that actors working in these new systems for moving value are subject to the same AML principles and requirements as other financial institutions”
They would instead evaluate each of the upcoming companies and make findings based on how much they have vested into making their platforms free from crimes such as money laundering, sanction evasion, drug and human trafficking. He however mentioned neither Facebook nor its Libra stablecoin.
“To the extent that the financial sector chooses to move forward with the opportunities that some of these emerging systems present, we are not going to allow it to slide backward on the protections and appropriate transparency that we have collectively worked so hard to weave into the financial system”
Dynamic regulatory landscape
He also added that they would be relentless in regulation of the financial space even if it came to setting up new guidelines for the ever dynamic sector. The industry would have to adhere to set guidelines or force the watchdog to intervene.
His remarks could be seen to align to the joint statement released late last year. The SEC, FinCEN and CTFC issued a three party press release in regards to digital assets. They emphasized on the importance of parties engaging in digital assets must conform to their AML and CTF standards.