On May 19, Alessio Evangelista, Associate Director of FinCEN’s Enforcement and Compliance Division, gave a presentation at the Chainalaysis Links conference on the topic “Intersection of Cryptocurrencies and National Security.” Evangelista said crypto firms “have the same obligations as all other financial institutions to ensure their new offerings can take advantage of innovations while protecting consumers, reducing cybercrime, combating illicit financial activity and ensuring that their platforms are not used to harm our national security.” He also pointed out that the agency believes that innovation goes hand in hand with regulation, rather than being at odds with each other. others.
Evangelista also said Virtual Asset Service Providers (VASPs) ignore red flags and too often continue to do business with problematic companies. He called on these VASPs to be proactive about regulatory compliance and avoid having “paper programs” or compliance regimes that exist on paper but are not implemented, either by mistake or by design. Here, FinCEN will continue to prioritize cases where it identifies “significant non-compliance and threats” to the financial system and where there is “a willful disregard of regulatory requirements.”
put into practice: These remarks follow a series of remarks from agency heads regarding cryptocurrency regulation (we have discussed these remarks in previous blog posts here and here). Financial institutions engaged in cryptocurrencies should pay close attention to these regulators as they begin to prepare for tougher regulation.