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Switzerland’s FINMA warns of money laundering risks with crypto

Author: Content Editor
Switzerland's Financial Market Supervisory Authority (FINMA) has issued a warning regarding the risks of money laundering associated with cryptocurrencies. The regulator noted in its 2024 Risk Monitor report that cryptocurrencies, including stablecoins, are increasingly being used for cyberattacks, payments for illegal activities on the dark web, and evading sanctions related to geopolitical conflicts. The report specifically highlights a significant rise in illicit transactions involving stablecoins for sanction evasion, posing challenges to anti-money laundering efforts. To address these risks, FINMA has outlined various measures, including onsite reviews, an audit program overhaul, and a focus on risk tolerance and management. The regulator also emphasized that financial intermediaries in the crypto sector without proper risk management could face legal consequences and damage to their reputation. This comes amid global regulatory concerns about cryptocurrency's potential links to illicit activities, prompting increased scrutiny and calls for enhanced oversight. The UK Financial Conduct Authority has similarly identified crypto-asset firms as among the sectors most vulnerable to money laundering, implementing a rigorous registration process. Notable platforms, including Binance and KuCoin, have also faced scrutiny over money laundering allegations. Tether, the issuer of the largest stablecoin USDT, has long faced accusations of facilitating money laundering, and it recently came under renewed scrutiny following reports of a US Department of Justice investigation into potential violations. Tether has denied any wrongdoing, stating that it has not seen any indication of an investigation.

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