UK legislators have moved to consider changes in the previously introduced Economic Crime and Corporate Transparency Bill. The legislation, aimed at empowering authorities to seize crypto assets linked to criminal activities, underwent a third reading at the UK upper parliamentary house, the House of Lords, on July 4.
UK Lawmakers Consider Recommendation To Approve Bill Empowering Authorities Against Crypto Crimes
The UK government introduced the Economic Crime and Corporate Transparency Bill in September 2022. The bill is part of the government’s measures to facilitate law enforcement authorities clamp down on crypto-related financial crimes.
However, in the just-concluded reading, the House of Lords members didn’t propose any changes to the bill. Instead, they described recommended changes as “minor” amendments.
The bill’s June 27 version included proposals to amend existing frameworks to allow law enforcement authorities more flexibility in the seizure and civil recovery of crypto assets. In addition, the bill elucidated the government’s authority over cryptocurrencies “intended for terrorism” or related reasons.
For now, UK legislators will weigh all amendments to the bill before passing it on for royal approval. Once approved, the Economic Crime and Corporate Transparency Bill becomes law.
In March 2023, the UK legislators disclosed plans to “stringently” regulate crypto to fight the illicit use of cryptocurrencies. It is part of the government’s 2023 to 2026 economic crime plan. At the time, lawmakers revealed they expected to pass the Economic Crime and Corporate Transparency Bill into law by quarter four (Q4) of 2023. They also planned to coordinate with various agencies to implement the Financial Action Task Force’s (FATF) Travel Rule.
UK Legislators To Enforce The FATF Travel Rule
The Financial Action Task Force (FATF), a global anti-money laundering watchdog, published its updated recommendations on June 30, 2022.
Part of the recommendations, tagged ‘Travel Rule’, requires Virtual Asset Service Providers (VASPs) and financial institutions offering virtual asset transfer services to collect and share the personal data of transactions’ senders and recipients.
Initially, the FATF’s Travel Rules were only applicable to financial institutions. However, in 2019, the agency expanded the recommendations to include virtual assets service providers and all platforms that offer crypto assets services.
The UK plans to enforce the FATF’s Travel Rule as a key Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) measure by September 2023. The Travel Rule requires VASPs or crypto exchanges to obtain, hold, and exchange information on virtual asset transfer originators and beneficiaries.
In the recently published Economic Crime Plan, the UK government noted plans to develop various delivery programs to support the FATF’s standards compliance.
The rules apply to all digital asset transfers based on the cross-border nature of digital asset activities and virtual asset service providers’ operations.
In addition to the Economic Crime and Corporate Transparency Bill, the House of Lords conducted a third reading for the Financial Services and Markets Bill on June 19. The legislation, aimed at supporting the adoption of cryptocurrencies in the UK, became law on June 29.
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