The European Union (EU) Introduces New Agency To Monitor Crypto And Curb Money Laundering


The EU is stepping up its anti-money laundering (AML) game and crypto monitoring with the introduction of a new agency.

European Commission Proposes New Anti Money Laundering Regulator

Documents seen by Reuters confirmed that the EU bloc is taking a tougher stand on money laundering, terrorist financing, and organized crime.

To this end, the EU's executive European Commission is proposing a new Anti-Money Laundering Authority (AMLA) that will become the “centerpiece” of a supervisory system made up of national regulators.

“By directly supervising and taking decisions towards some of the riskiest cross-border financial sectors obliged entities, the Authority will contribute directly to preventing incidents of money laundering/terrorist financing in the Union,” the documents read.

The European lawmakers are also drafting new requirements for virtual asset service providers (VASPs). One of which is to make it mandatory for data regarding cryptocurrency transfers to be accessible to European regulators.

The EU believes that the lack of regulatory oversight on the transfer of virtual assets nurtures money laundering and financing terrorist acts. This is because flows of illicit money can be done through transfers of crypto-assets.

Speaking on the upcoming rules, German Green Party member of the European Parliament Sven Giegold said the European Commission had done a good job putting strict rules against money laundering.

He said the parliament and EU states would have the final say over the proposed rules; however, in the meantime, the EU should pursue legal action against EU states that are not enforcing AML rules accordingly.

Cryptocurrency Clampdown In Europe

Europe has been making efforts to step up its rules regarding money laundering and cryptocurrencies in recent times. This is due to the rising concerns over the increasingly fragmented national regulatory landscape for crypto assets within the EU.

In September 2020, the European Commission issued a proposal titled Markets in Crypto-Assets (MiCA). The proposal has started the legislative process and is currently being debated.

Meanwhile, the UK is cracking down on crypto advertisements. According to Financial Times, the Advertising Standards Authority (ASA) has labeled cryptocurrency ads as a top priority.

The watchdog says most crypto market advertisements on social media are misleading and plan to go after them. ASA intends to clamp down on those violating the UK's advert policies.

The UK Financial Conduct Authority (FCA) has also taken action against major crypto exchange Binance in recent weeks. The agency issued a warning on its website stating that Binance is not permitted to undertake any regulated activity in the UK.

The regulator went on to warn citizens to be wary of adverts online promising high returns on investments in digital assets-related products.

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