U.S. Strengthens Anti-Money Laundering Act
With criminals around the world making a total of more than $300 billion yearly due to money laundering acts and illegal cross-border financial flows, the United States is showing that it has had enough and will no longer tolerate any kind of financial-related crime, especially those perpetrated by digital currency exchange firms, by strengthening its laws against money laundering. The Anti-Money Laundering Act of 2021 has been enacted into law, which took effect last January 1, 2021.
“For too long, our anti-money laundering laws haven’t kept up with the rapidly evolving methods that criminals and terrorists use for illicit financial activities. Our bipartisan bill is the largest comprehensive effort in decades to improve transparency and will give prosecutors, national security officials, law enforcement, and financial institutions the modern tools they need to crack down on money laundering and terrorist financing. Its inclusion in the annual defense bill is a great step forward for the rule of law and for the security of all Americans,” Alabama Sen. Doug Jones said in a press release celebrating the passing of the AML Act of 2020.
Reforms in the Bank Secrecy Act (BSA)
The AML Act of 2020 included significant reforms in the BSA, targeting digital currency exchange firms and other businesses dealing in digital assets. The term “financial institution” is now defined to include “a business engaged in the exchange of currency, funds, or value that substitutes for currency or funds” and “a licensed sender of money or any other person who engages as a business in the transmission of funds or value that substitutes for currency,” while the phrase “money transmitting business” now covers any person or entity engaging as a business in “currency, funds, or value that substitutes for currency.”
In addition to these definitions, stricter penalties are being imposed on violators. Fines can go as high as the entire amount earned from committing the violation, while those found to be guilty of “egregious” acts are banned from being a board member of any financial institution in the country for 10 years. Employees of financial institutions even have to give back to their employers bonuses received during the year the violation was committed.
Digital currency exchange companies and other related businesses need to comply and be more vigilant in their obligation “to actively detect, monitor and report potential money laundering activity,” or else they may face exorbitant fines and possible jail time.
These reforms, however, does not concern Bitcoin SV as it has made it a policy to abide by laws since its inception. As Bitcoin creator Satoshi Nakamoto, known in the real world as Dr. Craig S. Wright, once said, “Bitcoin needs to work within the law to be valid.”