A two-day workshop involving over sixty financial investigators in Basel, Switzerland has seen Europol and Interpol agree upon a range of measures designed to ramp up efforts to combat the use of cryptocurrencies for money laundering and terrorist financing purposes. The event saw attendance from over 60 international financial investigators.
Financial Investigators Discuss Cryptocurrency Regulations
The recent workshop was hosted by the Basel Institute on Governance and organized in partnership with Europol and Interpol. The event saw attendance from more than sixty
“financial investigators from money laundering, cybercrime and financial intelligence units from 32 different countries”, in addition to
“relevant private sector representatives.”
The workshop has produced agreements between attending institutions designed to reduce the
“misuse of cryptocurrencies by criminals and terrorist financiers to launder money and support other criminal activities.” Specifically, the agreed measures include:
- An increase in
“information sharing in the field of money laundering and digital currencies through the use of channels such as Europol, Interpol, the Egmont Group and FIU.net.”
- The regulation of
“digital currency exchangers and wallet providers under current anti-money laundering and counter-terrorism financing legislation.”
- Agreements regarding
“clear definition[s] of concepts such as cryptocurrencies, digital currency exchanger, wallet provider and mixer for them to be included in the EU legal framework.”
“Tak[ing] action against digital currency mixers/tumblers, designed to anonymize transactions, which burdens the work of law enforcement agencies to detect and trace suspicious transactions.”
Europol Claims Cryptocurrencies Increasingly Used to “Finance Criminal Activities Including Terrorism”
In the statement issued following the event, Europol has claimed that the adoption of cryptocurrencies for criminal purposes, including terrorist financing, is rising. In order to combat the allegedly growing threat, Europol announced that it will
“continue to coordinate across EU Member States and beyond in an endeavor to effectively respond to this rising threat.”
Europol’s claims comes just weeks after a bill was introduced to Congress by Republican House Representative Ted Budd of North Carolina on January 10th proposing the creation of a new task force assigned with researching and developing policy to combat the financing of terrorism through the use of cryptocurrencies.
Terrorist Concerns Overblown
The increased concerns relating to the use of virtual currencies by terrorist groups appears to have been sparked by the Foundation for the Defense of Democracies’ recent report that claims the to have identified four instances in which groups associated with terrorists have solicited donations in the form of Bitcoin — which have occurred more than a year after the last instance of such identified by the think-tank.
The author of the report, Yaya Fanusie, has attributed the terrorist groups soliciting donations in cryptocurrency to the recent increased
“attention [given] to Bitcoin” in the media, arguing that such
“has probably led to certain groups taking a look at the technology,” Mr. Fanusie added,
“In general it appears these campaigns have not been very successful, for the most part.”
Research recently published by Elliptic has also indicated a more than forty percent reduction in the percentage of all Bitcoin transactions associated with criminal activities since 2013 — estimating that transfers tied to illicit activities comprise just 0.61% of all transactions. In October 2017, a report commission by the UK government similarly concluded that virtual currencies posed a “low” terrorism financing risk which is “unlikely” to increase during the coming five years.