Veriff
Header image for blog about NatWest's AML failing
KYC news

‘Alarming’ AML laws prompt protests from EU crypto firms

The crypto sector has written to European Union finance ministers and lawmakers, asking them to rethink anti-money laundering rules it believes are “burdensome” and “alarming”. 

May 9th, 2022

Share

Share

Love this blog? Why not share it with the world?

The crypto sector has written to European Union finance ministers and lawmakers, asking them to rethink anti-money laundering rules it believes are “burdensome” and “alarming”. 

The letter, which was seen by CoinDesk and was signed by academics, lobby groups and a number of senior executives from companies within the crypto space, says that the EU’s current proposals to identify crypto users endanger privacy and innovation.

The letter, which was dated April 13, stated that “the proposals from the European Parliament, by leading to the public disclosure of all transactions and digital asset wallet addresses, will put every digital asset owner at risk” and “risk derailing years of preparatory work and the future of Web 3” in Europe.

Laws go further than first intended

The laws were first proposed by the European Commission in July 2021. Initially, lawmakers intended to implement standards set by the Financial Action Task Force (FATF).

However, since then, lawmakers and governments in the EU have sought to add extra constraints to crypto companies. For example, initially the law included a €1,000 ($1,080) threshold for naming participants. However, this has since been removed. Now, crypto companies are asking lawmakers to return to FATF’s original plans. 

The crypto companies have also taken exception to a separate law, which is known as the Markets in Crypto Assets Regulation (MiCA). In their letter to the EU, they called for lawmakers and governments to exempt decentralized organizations and algorithmic stablecoins from regulatory obligations.

Why the laws changed and when they’ll come into force

The EU’s draft anti-money laundering laws were passed by lawmakers at the end of March. This was after crypto regulators warned them that even small crypto payments (below the previously-announced threshold) could be used to fund crimes linked to terrorism and child pornography.

However, although the new draft anti-money laundering laws have been passed, the governments of EU countries must agree on the final text before they come into force. As a result, there’s still a chance that the final laws that will govern crypto firms in the EU will be different to the current proposals.

Ensure compliance with KYC regulations with Veriff

The news from the EU shows how quickly KYC regulations can change. Thankfully, with the help of Veriff, you can ensure AML and KYC compliance at every turn.

Our AML and KYC compliance solution can help you fight financial crime and show regulators that you take compliance seriously. As well as helping you verify the identity of your customers, our solution also screens global sanctions and politically exposed persons lists and checks for negative news. As political and regulatory environments change very quickly, it also provides ongoing monitoring.

To discover more about how we can help you, book a free personalized demo with the team today.

Stay up to date on Veriff news, product updates, and more

Veriff will only use the information you provide to share blog updates. You can unsubscribe any time. For more details, check out our privacy policy.

Related articles

$100m in NFTs stolen via scams in the past year: how can collectors stay safe?

KYC news

$100m in NFTs stolen via scams in the past year: how can collectors stay safe?

Estimates suggest that cybercriminals have stolen more than $100 million worth of non-fungible tokens (NFTs) within the past year. Added to this, criminals have also indulged in other NFT-related scams, such as the use of digital asset mixers in NFT money laundering. As such, collectors need to take proactive measures to keep their assets secure.

Crypto criminals laundered more than $500 million via cross-chain bridges

KYC news

Crypto criminals laundered more than $500 million via cross-chain bridges

Cross-chain bridges can hold hundreds of millions of dollars of assets in escrow. Plus, because they multiply their possible vectors of attack by operating across two or more blockchains, they become prime targets for hackers.

What the UK’s economic crime bills mean for the fight against money laundering

KYC news

What the UK’s economic crime bills mean for the fight against money laundering

The Economic Crime (Transparency and Enforcement) Act focuses on property ownership. At its core, it recognizes that layers of secrecy and foreign-owned companies allow individuals to bypass sanctions by hiding the true ownership of property in the UK.