How to Use FinCEN/FATF’s Red Flags for Virtual Currency Compliance Program
In 2020, FinCEN and Financial Action Task Force (FATF) released various publications designed to assist financial institutions (FIs), designated non-financial businesses and professions (DNFBPs), and Virtual Asset Service Providers (VASPs) in identifying and mitigating risks of virtual currency (VC) transactions. But how can these be applied to an AML compliance program?
Pamela Clegg, Vice President of Financial Investigations at CipherTrace reviews the red flag indicators published by FinCEN and FATF and addresses how they fit into an AML compliance program. She also discusses how to use blockchain analysis and cryptocurrency intelligence to identify these red flags and mitigate their risks, as well as, a number of case studies that shows how financial institutions were able to identify illicit activities involving virtual currencies that were flowing through their institution.
Disclaimer: The contents of this article are intended to provide a general understanding of the subject matter. It is not intended to provide legal or other professional advice, and should not be relied on as such.