Director of FinCEN: complaints regarding cryptocurrency exceed 1500 per month


Cryptocurrency- Despite the demand for Exchange Traded-Funds and other SEC-regulated options for investors, cryptocurrency continues to remain a largely lawless place. A new report from the US Financial Crimes Network has cast an overwhelming light on the industry in terms of suspicious activity and other forms of improper gaming.

In a speech delivered at the Tech Tech Conference of the Chicago-Kent block of 2018 last Thursday, FinCEN Director Kenneth A. Blanco dropped a relative bomb when he told the audience that his investigative arm received over 1500 cryptocurrencies related complaints every month. Classified as reports of suspicious activity (SAR), complaints continued to grow throughout the year, indicating the need for more supervision. While members of the cryptocurrency sector rightly avoid the centralized presence of further government regulations, the volume of cryptocurrency reports and the growing number of complaints that have been imposed on FinCEN and the SEC have depicted a landscape in some unrest. While cryptocurrency still represents a gray space in terms of enforcement and regulation of financial behavior, the department is working with the US Securities and Exchange Commission (SEC) and the US Commodity Trade Commission (CFTC).

Blanco told attendees at the conference,

"Innovation in financial services can be a great thing … we must also be aware that financial crime evolves right with it, or even because of it, creating opportunities for criminals and bad actors

Instead of condemning the cryptocurrency industry for its role in producing an epidemic number of scams and complaints, Blanco still finds innovative technology and recognizes the need to promote such growth despite the current lack of regulation, he said that the field of fintech and cryptocurrency was full of "incredible innovations", but he needed to find a way to work with regulators to implement some guidelines to protect investors and avoiding fraud

"the damage can be done with devastating speed, amplitude and darkness in the digital world. "

In addition to providing specific examples of cryptocurrency exchanges that did not comply with the FinCEN regulations, despite falling under the umbrella of companies accepting transfers of value in fiat or fiat substitutes, Blanco commented that most of the Cryptographic companies take the necessary steps to comply with the legislation when the signal is given that an examination is imminent.But Blanco has made it clear that meeting the regulatory requirements under consideration is not a substitute for following the law on a regular basis. these exchanges, Blanco has had hard words,

"Let this message be published clearly today: this does not constitute conformity."

Blanco also took the time to comment on the nature of the ICO industry, a market which has substantially broadened over the last two years, despite a discovery at the beginning of the year that it concludes that 80 percent of all ICOs will be able to had ranked as a "scam", the market continued to see exponential growth. Through the first two quarters of 2018, the total volume of ICOs already doubled compared to the previous year, with 2018 aiming to continue a strong tendency towards the growth of initial coin offerings. Blanco claimed that the current model for ICOs is quite convoluted to fall under different regulatory umbrellas, but that companies behind the offer still have to comply with anti-money laundering and anti-terrorist financing obligations.

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