Treasury’s Brian Nelson calls on Congress for enhanced resources to combat crypto crime and illicit finance misuse. By Maxwell Mutuma 3 hours ago
Story Highlights
- The U.S. Treasury is raising concerns to lawmakers about the risks cryptocurrencies pose to financial security, seeking stronger legislative tools to combat illicit finance.
- Treasury’s Under Secretary, for Terrorism and Financial Intelligence emphasized the need for enhanced resources to address the evolving challenges in the crypto space.
- Efforts are underway to prevent terrorist groups like Hamas from using digital assets, highlighting a broader strategy against financing mechanisms supporting terrorism.
In a significant move to bolster its fight against illicit finance, the U.S. Treasury has voiced its concerns regarding crypto crime to House lawmakers. The agency is pushing for enhanced legislative tools and resources to tackle these challenges effectively. The call for action was outlined by Brian Nelson, the Treasury’s Under Secretary for Terrorism and Financial Intelligence, in his prepared testimony ahead of a congressional hearing focused on terrorism and crypto crimes.
Treasury’s Concerns and Legislative Aspirations
Nelson expressed the Treasury’s deep-seated worries about using virtual assets in illicit financial activities. His comments come at a time when Washington lawmakers, spurred by figures such as Sen. Elizabeth Warren and Senate Banking Committee Chair Sherrod Brown, have been intensifying their focus on combating illicit finance within the cryptocurrency sector. The Treasury has been working over the past decade on a framework aimed at combating the financing of terrorism, balancing the need to mitigate illicit finance risks with promoting responsible innovation.
Despite possessing certain tools to address issues, such as holding firms accountable for non-compliance with the Bank Secrecy Act, Nelson emphasized the necessity for additional tools and resources. He highlighted the importance of working alongside Congress to adopt reforms that would update the Treasury’s tools and authorities better to address the evolving challenges of today’s financial landscape.
Treasury Seeks More Power to Tackle Crypto Crime
The Treasury Department has recommended that lawmakers amplify its authorities, including implementing new sanctions tools to pursue bad actors in the crypto space more effectively. Although stablecoins were not mentioned in Nelson’s testimony, the Treasury has previously indicated that they require greater oversight. Nelson also discussed efforts to prevent groups like Hamas from utilizing digital assets to support terrorism, acknowledging the continuous evolution of methods used by such groups to raise, transfer, and store illicit proceeds.
This proactive stance is part of a broader strategy to ensure that the financing mechanisms tied to entities like Hamas are targeted and disrupted. The Treasury’s commitment to this cause was further underscored by the release of its 2024 National Risk Assessments on Money Laundering, Terrorist Financing, and Proliferation Financing. These reports highlight the persistent threat of illicit finance within the U.S., noting an increasing shift from traditional cash-based laundering to utilizing virtual assets.
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The Treasury’s call for enhanced legislative tools and resources to combat crypto-related crimes is set against growing concern over using digital assets in illicit financial activities. The forthcoming hearings by the House Financial Services Committee on crypto and illicit activity signify the increasing attention paid to this issue at the highest levels of government.
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