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17 11, 2022

DAILY111722

2022-11-17T17:18:13-05:00November 17th, 2022|2- Daily Briefing|

Warren, Durbin Demand Answers about FTX Collapse

Following FTX’s collapse, Majority Whip Durbin (D-IL) and Sen. Warren (D-MA) sent a letter today to FTX founder Sam Bankman-Fried demanding a detailed accounting of the company’s decisions and business practices.  We doubt they will get an answer anytime soon, with this letter joining a flood of Congressional inquiries and likely hearings (see Client Report REFORM215).

Jefferson Supports Limited Fed Mandate

In remarks today, FRB Gov. Phillip Jefferson disputes those – including many progressive Democrats – who believe that racial equity and economic equality are an intrinsic part of the Fed’s mission.  Specifically, he states that, while consumer protection, community development, and financial stability can promote inclusive growth, monetary policy cannot directly address it or why low-income households are more acutely affected by inflation.

Fed CBDC Survey Suggests Possible CBDC Upside

A new Fed literature review evaluating the macroeconomic implications of CBDC focuses on the financial inclusion and payment system impacts CBDC would have in the U.S. and advanced economies.  As is usually the case with surveys, it reaches cautious conclusions, including that CBDC could increase financial inclusion for the unbanked.  It might also reduce financial frictions in deposit markets, enhance retail payment-system efficiency, facilitate international transactions, and spur private-sector banking and payments innovation.

Daily111722.pdf

17 10, 2022

CRYPTO34

2022-10-24T11:26:12-04:00October 17th, 2022|1- Financial Services Management|

Global Cryptoasset/Stablecoin Standards

Speaking for global banking, securities, and insurance regulators, the Financial Stability Board has taken its firmest stand to date on cryptoassets and outlined high-level and often principles-based global standards to govern them going forward.  Although generally limited to financial stability and often couched in broad terms, these global standards would generally track the very crypto-cautious stand taken by U.S. regulators as well as policy set by the Securities and Exchange Commission, not that also of the Commodity Futures Trading Commission when it comes to cryptoassets that cross traditional sectoral boundaries.

CRYPTO34.pdf

6 10, 2022

DAILY100622

2022-10-06T17:22:24-04:00October 6th, 2022|2- Daily Briefing|

OSTP Establishes AI User Rights, Privacy Protections

The White House Office of Science and Technology Policy (OSTP) has released a little-noticed AI “Bill of Rights” that establishes AI user rights and data privacy principles.  Although nonbinding, this framework now sets policy that individual agencies are likely to follow even if they are nominally independent, as is the case with the FRB, OCC, and FDIC.  The CFPB is no longer independent and is in any case already committed to like-kind principles; the banking agencies so far have only issued an RFI (see FSM Report AI).

OCC Tightens Fintech, Payment, Crypto Supervisory Screws

The OCC today released its Bank Supervision Operating Plan for FY2023, highlighting the Office’s supervisory issues based in part on policy considerations.  The agency is prioritizing cybersecurity; third-party service providers with a particular focus on fintechs; consumer-protection and AML compliance; new product risk, such as payment systems technology and digital assets; and climate risks.

Daily100622.pdf

23 09, 2022

FedFin on: Digital Asset AML/CFT Compliance

2022-09-30T12:01:32-04:00September 23rd, 2022|The Vault|

Treasury is seeking comments on issues raised by the President’s executive order (EO) on digital assets to guide further work curbing illicit-finance and national-security risks in this sector.  The request includes no policy discussion beyond introductory comments about the risks identified in Treasury’s reports, but the range of questions suggests openness to at least some industry-supported compliance and reporting systems that …

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23 09, 2022

AML136

2022-09-26T08:40:55-04:00September 23rd, 2022|1- Financial Services Management|

Digital Asset AML/CFT Compliance

Treasury is seeking comments on issues raised by the President’s executive order (EO) on digital assets to guide further work curbing illicit-finance and national-security risks in this sector.  The request includes no policy discussion beyond introductory comments about the risks identified in Treasury’s reports, but the range of questions suggests openness to at least some industry-supported compliance and reporting systems that might facilitate adoption of at least some digital and virtual products.

AML136.pdf

16 09, 2022

DAILY091622

2022-10-13T10:14:58-04:00September 16th, 2022|2- Daily Briefing|

Treasury Presses For CBDC, Fast Payments With Nonbank Access

We will shortly provide clients with an in-depth analysis of each of the Administration’s policy-setting crypto reports, but draw your attention now to key payment-system recommendations.

Treasury Presses Crypto Reg Framework, New Role for CFPB

Continuing our series on the Administration’s crypto policy reports, we turn now to the paper on overall cryptoasset regulation.

Administration Also Plans Focus on Crypto Crime, Market Risk

In addition to the reports assessed in earlier alerts on CBDC, the payments system, and cryptoasset regulation, the administration today released numerous other digital asset policy actions.

Warren Demands Treasury Address Crypto’s Financial Stability, Sanctions Risk

Even as the White House released numerous cryptoasset reports today and Treasury called for action on several fronts, Sen. Warren (D-MA) demands more.

Daily091622.pdf

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