Elizabeth Warren targets crypto money laundering with new bill

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Senator Elizabeth Warren on Wednesday announced bipartisan legislation to crack down on cryptocurrency money laundering with a bill called the Digital Asset Anti-Money Laundering Act of 2022.

The bill, which is co-sponsored by Senator Roger Marshall of Kansas, is designed to “mitigate the risks that cryptocurrency and other digital assets pose to the national security of the United States by closing gaps” in the current anti-money laundering system. The goal is to create compliance standards for digital currencies that are more like the rules that govern the rest of the financial system.

For years, there has been little US regulation regarding cryptocurrencies, but the bipartisan bill seeks to change that. For example, the bill would extend certain responsibilities of the Bank Secrecy Act to digital assets, such as the Know-Your-Customer requirement, which requires banks to validate the identity of their customers.

Warren’s announcement of the bill follows the most high-profile cryptocurrency scandal to date: the collapse of FTX, previously the world’s second-largest cryptocurrency exchange, and the subsequent arrest of its former CEO, Sam Bankman-Fried, who faces money laundering charges. , among others.

In a statement, Warren said the cryptocurrency industry should be governed by the same kind of rules as other financial institutions. “Rogue nations, oligarchs, drug lords and human traffickers use digital assets to launder billions in stolen funds, evade sanctions and fund terrorism,” Warren said in a statement. “The crypto industry should follow common sense rules like banks, brokers and Western Union, and this legislation would ensure that the same standards apply to similar financial transactions.”

Cybercriminals harvested a record at least $14 billion in digital assets last year, according to a statement from Warren’s office. The Massachusetts senator also participated in the Senate Banking Committee hearing on the FTX collapse on Wednesday.

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