Problems in the Revised FATF Standard - Part 3

Overall, most jurisdictions have made significant progress in implementing the revised FATF Standard. More than half of FATF members said that they had incorporated the FATF Standard into domestic law, but the challenges remained. Some jurisdictions have not yet operated the anti-money laundering systems, some have not yet been established. Moreover, this review does not cover the entire FATF global network, so it’s unknown for the progress situation of FSRB members who have not submitted reports.

Cipher Trace, a blockchain company, claims that the virtual asset loss caused by illegal access, theft and fraud between January and May, 2020 reached US $1.36 billion. Among the crimes related to encrypted assets, fraud cases are increasing year by year. Under the regulation of FATF "Travel Tules", encrypted assets enterprises should strengthen the control of their own security system.

After this round of review, FATF will conduct the second review of 12 months before June 2021 to continue to strengthen the supervision of virtual assets and virtual asset service providers, and will consider whether it is necessary to further update the FATF Standard. At the same time, FATF will continue to work with the private sector to promote the understanding of money laundering and terrorist financing risks of virtual assets and virtual asset service providers. FATF should continue to promote awareness among the public and national authorities of the money laundering risks involved in virtual assets transactions. For this, FATF will provide the public with red flag indicator information related to virtual asset transactions in October 2020 and strengthen effective cooperation with VASP regulators.