The heads of three financial regulators of the US, namely SEC (Securities and Exchange Commission), CFTC (Commodity Futures Trading Commission), and FinCEN (Financial Crimes Enforcement Network) have released a joint statement on October 11th, warning the crypto asset industries to adhere to the banking regulations. This move primarily focusses on countering the AML or the Anti-money laundering and terrorist financing.
The regulatory authorities made it very clear to the crypto asset users that they need to abide by the financial and banking laws despite their use of digital tokens. The crypto asset industries are required to register their businesses to various regulatory agencies. The nature of the business that each company is associated with will determine the specific guidelines that each company has to follow.
The respective agencies also released a set of comments along with the joint statement, addressing future commission brokers and merchants explaining to them how they should register with various regulatory bodies. The regulatory authorities, in turn, will be responsible for protecting the interest of the investors by providing them a fair market and also assist in capital formation.
In the statement released on Friday, October 11, the regulators reminded the crypto users of their obligations to report any illicit use of crypto to the regulators, as per the Banking Secrecy Act. This has been the main cause for concern lately for the regulators to counter anti-money laundering. The statement reads, “Among those AML/CFT obligations are the requirement to establish and implement an effective anti-money laundering program (AML Program) and recordkeeping and reporting requirements, including suspicious activity reporting (SAR) requirements.” The signatories to the statement were, CFTC Chairman Heath Tarbert, SEC Chairman Jay Clayton, and FinCEN Director, Kenneth A. Blanco.