Summary
The US Treasury Department has released a series of reports stating that while cryptocurrencies are increasingly being used by illicit actors for money laundering and financing operations, cash remains their preferred tool. The reports highlight that fiat currencies are still the primary medium for money laundering, and terrorists continue to use traditional methods such as banks and money transmitters. However, digital assets are becoming a growing threat. Fraud, particularly investment schemes and healthcare fraud, is identified as the main driver of money laundering. The reports also note that terrorist groups like ISIS and Hamas are increasingly using virtual assets for funding. Lawmakers have expressed concerns about the role of cryptocurrencies in illicit finance and have called for measures to protect privacy concerns while addressing these issues. The Treasury will release its annual strategy for combating illicit finance in the coming weeks, which will include recommendations on addressing the highlighted issues.
Key Points
1. The US Treasury Department reports that although cryptocurrencies are increasingly being used for money laundering, illicit actors still prefer to use cash as their primary tool.
2. The Treasury officials highlight that while traditional methods like banks and money transmitters are still utilized by terrorists for money laundering, digital assets pose a growing threat.
3. Fraud, particularly through investment schemes and healthcare fraud, remains the main driver of money laundering activity, according to the National Money Laundering Risk Assessment. Additionally, the report notes an increase in fraud involving technology, such as telemedicine and virtual asset investment scams.