FBI urges not to use crypto services without KYC system to avoid loss of funds

Funds can be seized by law enforcers due to links to illegal activity

26.04.2024 - 15:45

2 min

What’s new? FBI officials have issued a statement warning citizens against using crypto services to transfer money that are not AML compliant and are not registered as Money Services Businesses (MSBs). Funds on such services can be blocked in the course of law enforcement actions.

FBI appeal

What else is known? The bureau noted that even inadvertent use of such services can cause “financial disruptions” because funds stored on them can be seized by authorities because of links to criminal activity. Officials said that the lack of a customer identification system (KYC) will help identify risky services.

They emphasized that services that do not ask for name, date of birth, address, and ID before allowing money or cryptocurrency to be sent or received should not be used.

They also urged to check whether the company is registered as an MSB with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN), information on this is available on the official website of the agency. It is separately emphasized that the fact that a crypto application is available in the App Store marketplace does not guarantee its legality and compliance with US federal laws.

Finally, the FBI urged against using services that are openly promoted as money laundering tools.

FBI: The volume of investment crypto fraud grew by 53% in a year

The bureau also noted that scammers from other areas are increasingly turning to cryptocurrency

Earlier this week, US authorities seized the servers of crypto mixer Samourai and accused its founders of conspiring to launder money. The charge sheet noted that the developers promoted Samourai as a means of circumventing sanctions.

In early April, Google accused two Chinese citizens of downloading 87 fraudulent applications to the Google Play marketplace.

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