European Parliament Votes for Tighter Crypto AML Regulations

Members of the European Parliament decided to vote in favour of tighter crypto AML regulations. These anti-money laundering reforms will include closer regulation for cryptocurrencies. 574 members voted in favour of this, with only 13 votes against and 60 abstentions, according to an EUP press release.

The press release stated that this is the fifth update to the EU’s anti-money laundering directive, known as ‘5AMLD,’ that is a follow up to the terrorist attacks in Paris and Brussels in 2015 and 2016, and also the Panama Papers leaks.

The new reforms have been created with the intention to strengthen transparency rules so that large-scale concealment of funds can be better prevented. The specific crypto AML regulations will require crypto exchanges and custodian wallet providers to apply greater customer due diligence controls and will also require customers to be registered for the exchanges and wallets.

In addition, the crypto AML regulations will also put pressure on trusts and trading companies to reveal cryptocurrencies holders.

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The main goal of the reforms, in terms of cryptocurrency, is to eliminate anonymity in the crypto trading world.

“Criminals use anonymity to launder their illicit proceeds or finance terrorism. This legislation helps address the threats to our citizens and the financial sector by allowing greater access to the information about the people behind firms and by tightening rules regulating virtual currencies,” said Member of European Parliament Krišjānis Kariņš.

5AMLD is also proposing to crack down more heavily on tax evasion.

In a broader sense, the anti-money laundering reforms are looking to grant the right of access to data from firms, trusts, and other similar bodies to anyone who can demonstrate a “legitimate interest.” This includes European citizens, NGOs, and investigative journalists.

EU member states will have 18 months to put the updated directive into action into the national law.

What do you think about the European Parliament’s updated crypto AML regulations?

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