US Legislators Propose Bill to Investigate Cryptocurrency’s Role in Illegal Financial Activities.

A bipartisan bill that would create a working group to investigate the use of cryptocurrencies in illegal financial activities including money laundering, was introduced to both the US Senate and House of Representatives on Thursday. The study would include an analysis of existing regulations with an aim to develop systems that counter misuse of the currencies. The Financial Technology Protection Act was co-sponsored by Senators Kirsten Gillibrand and Ted Budd, and Congressmen Zachary Nunn and Jim Himes. Nunn asserts the analysis is necessary to evaluate the risks changing for adversaries such as terrorists, cartels, and Cybercriminals. Industry analytics firms, research organisations, financial institutions and technology companies could all be appointed to the group should the bill be passed, although much of the research into criminal activities conducted by crypto research firms is done internally. The bill sets deadlines for interim documents, final reports and annual recommendations, for a four year period following the signing of the bill into law.

What the Bill Intends to Do

The Financial Technology Protection Act that targets illegal activity involving cryptocurrencies was put forth by the US House of Representatives and the Senate today. Should the bill pass. legislators anticipate the formation of a working group to facilitate research on financial crimes where cryptocurrencies, and block-chain or other digital ledgers are involved. Criminal activity would include an assessment of money laundering as a tool for parallel activities e.g. financing illegal arms trades or illegal trafficking from opioids to people.

Young Legislature Looking Into the Shadow Border Currency

In a recent exclusive chat with a media outlet, Congressmen and co-speaker of the bill Zachary Nunn (R-Iowa) described nine different agencies generally tasked with focus on illegal finance streams such as money laundering, arms trades or human trafficking. Contrary to various industry research that already more or less covers regulative frameworks on money laundering, Nunn remarked that the bill proposed a revisit of strategies implemented by sitting agencies in light of new efficient technologies providing service to those with involvement in shadow border controls:-

“To date these tasks are generally split up into many different agencies. They don’t really start looking in so much until there is an incident. And by starting now with this group, we’re picking up on a trend that a lot of the commercial interests in this area have already started considering; rather than these sub-departments working independently re-evaluation.”

Composition of the Investigative Committee and Process

Industry participants that could sit in the different technical and financial committees mandated under the act include analytics firms, law enforcement agents and representatives of research organizations globally aiding in the investigative and collaborative nature of the report while U.S. sub-departments under the attention of Congress would provide resources through departments such as anti-narcotics (DEA), the Federal Bureau of Investigations (FBI) and Counter Intelligence among others.

The Treasury Department is set to take situational control and overarching responsibility for the initiative as set by legislators. Additional calendar milestones concerning intervals of 1 to 4 years will be issued yearly highlighting to legislators what progress has been accomplished by the committee, pending regulatory groups.

The bill specifies deadlines advocated by policymakers for the group tasked with criminal market reforms, agency partnerships, a year-end summary and a four-year comprehensive overview. The bill excludes specifics and mandates no directions on cryptocurrency payments and the broader stance the country should reach with various cryptocurrencies from established ones such as Bitcoin and Ethereum to those in establishment, the parliamentary oversight of Bitcoin enterprises through regulatory bodies proceeding adjacent industrial modifications alongside parallel movements ranging from the SEC to the Commodity Futures Trading Commission (CFTC), is yet to establish guidelines that stipulate predictable regulative frameworks.
[h/t Nikhilesh De]