U.S Regulators Come For The Industry Again, Penalize Bitcoin Trader For Violating AML Laws

Hong Kong Financial Regulator raise alarm over ICOs - Cryptocurrency News

When looking for the best cryptocurrency to invest 2019, one thing traders put into consideration is the secure and anonymous nature of the blockchain. Through the Bitcoin blockchain, value can be sent from one point to the other without interference from centralized authorities. However, some countries have made it necessary that user to verify their identity before performing transactions to curb the incidence of money laundering. A Bitcoin trader in the United States was recently penalized for not following these AML laws in his cryptocurrency business. This is the first time the United States regulator, FinCEN, is penalizing anyone in the cryptocurrency space according to the cryptocurrency news now on CoinDesk.

Best Cryptocurrency To Invest 2019 To Avoid Breaking AML Laws – Cryptocurrency News Now

On Thursday, the Financial Crimes Enforcement Network, typically called FinCEN, announced that a cryptocurrency trader has violated its anti money laundering laws and had to face the penalty. The Bitcoin trader in question is called Eric Powers and he resides in California. From the year 2012 to 2014, Powers failed to comply with the Bank Secrecy Act’s (BSA) registration and reporting requirements while he sold cryptocurrency on the internet.

Powers ran a business online in which he sold the best cryptocurrency 2019, Bitcoin, to interested buyers without registering himself. To make the business legal, Powers was supposed to register his company as a money services company or register himself as a money transmitter in line with the anti money laundering laws.

Bitcoin (BTC) Price Today – BTC / USD

#NamePrice24H %
1
bitcoin
Bitcoin(BTC)
$8,551.81
0.744%

Apart from this, there were numerous suspicious cryptocurrency to fiat transactions that happened under his watch but he did not report anyone to the regulators. In fact, he didn’t file any currency transaction report at all. The FinCEN said that within the 2012 and 2014, his company conducted more than 200 transactions that involved $5 million in Bitcoins and physical transfer of cash amounting to about $10,000. This included many suspicious transactions that may have been related to money laundering. He also allegedly enabled transactions for people in Silk Road, the darknet marketplace.

According to Kenneth A. Blanco, the director of FinCEN, Powers admitted to all the charges against him and would be penalized as any corrupt money transmitter would. In his words;

“Obligations under the BSA apply to money transmitters regardless of their size.”

Blanco also said that they have reason to believe that Powers did not make these violations out of ignorance but was fully aware of the obligations making him a willful deviant of the anti money laundering laws. He continued;

“Such failures put our financial system and national security at risk and jeopardize the safety and well-being of our people, as well as undercut responsible innovation in the financial services space.”

Cryptocurrency News Now – What Penalty Awaits Defaulters?

As a penalty for breaking the anti money laundering laws, Powers was fined $35,000. He has also been barred from offering money transmission services in the future. This is in line with the ruling made by the FinCEN in 2014. The U.S regulators said that cryptocurrency exchanges and payment processors are categorized as money services businesses. In 2018, they announced that all money transmitter rules apply to the cryptocurrency industry including initial coin offerings.

While this is going to promote order and reduce the incidence of money laundering in the cryptocurrency space, there are those who believe that the best cryptocurrencies should not be regulated. Over regulation may defeat the purpose of cryptocurrencies and blockchain technology as a whole.

What do you think about the ruling of the United States regulators against Eric Powers? Should the best cryptocurrency 2019 be regulated with the same laws as fiat money? Share your thoughts in the comment section.

Ufuoma Ogono is a cryptocurrency writer with over 3 years experience in the cryptocurrency industry. She dedicates her time to sharing valuable information to members of the cryptocurrency community.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.