FATF chief says closely monitoring Facebook's Libra

September 11, 2019 09:53
Facebook's Libra cryptocurrency project is facing growing scrutiny from regulators around the world. Photo: Reuters

The Financial Action Task Force (FATF), the global anti-money laundering watchdog, is closely monitoring developments on Facebook’s planned Libra cryptocurrency, the agency's new chief said on Tuesday.

“We want to make sure that if there are significant risks, they need to be addressed,” Reuters quoted Xiangmin Liu, the president of the Paris-based FATF, as saying.

Liu said the illegal use of cryptocurrencies is probably spreading at pace.

Known examples, from money laundering to drug trafficking, probably represent only a fraction of the true scale of criminal use, he said.

“The anonymity afforded by virtual assets is being exploited by serious criminals,” Liu said, according to Reuters.

“These activities are likely to be growing quickly, as law enforcement agencies are only seeing the tip of the iceberg.”

Liu, who took charge of FATF in July, said the volume and speed of cryptocurrency transactions presents a growing challenge in pinpointing illegal use, even as technology to identify such actions is developed.

“We have talked about finding suspicious activity as being like finding a needle in a haystack,” he said. “Well, that haystack is getting bigger and bigger, and is moving all the time.”

In the first global attempt to bring the crypto sector to heel, the FATF told countries in June to tighten oversight of cryptocurrency exchanges to stop digital coins being used to launder cash and finance terrorism, Reuters noted.

Earlier on Tuesday, a senior US Treasury official, speaking to reporters in Switzerland, said Libra must meet the highest standards for combating money laundering and terrorism financing if it is to get off the ground.

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