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The FCA Doubles Down on ‘Travel Rule’ Enforcement for Crypto Transactions

Press Releases Crypto News BeInCrypto The FCA Doubles Down on ‘Travel Rule’ Enforcement for Crypto Transactions

The United Kingdom’s financial regulator, the Financial Conduct Authority (FCA), has gotten serious about stopping the use of cryptocurrency for money laundering and other crimes. It has implemented much tougher requirements for companies operating in the cryptoasset space.

The agency will brook no deviation from the “Travel Rule,” which mandates the sharing of detailed information about parties on both sides of a crypto transaction. The FCA is no outlier on this issue, but has set forth its guidelines partly under the influence of the US Financial Action Task Force (FATF).

The FCA Wants to Stop Crypto Money Laundering in Its Tracks

An official notice posted on the FCA’s website on Thursday, and updated on Friday, sets September 1, 2023, as the travel rule compliance deadline. From that date on, it states, UK crypto firms must “collect, verify, and share information about cryptoasset transfers.”

The regulator seeks to curb the high levels of illicit activity with which cryptocurrency, sadly, is still associated. And, from the FCA’s standpoint, this goal requires more probity on the part of crypto firms. They must do more to ensure they are not doing deals with money launderers and other bad actors.

To this end, the FCA goes beyond the requirement spelled out above and lists a number of guidelines for firms undertaking trades and transfers of crypto. They must “take all reasonable steps and exercise all due diligence” around Travel Rule compliance.

Moreover, firms are responsible for such compliance even on the part of third-party entities that play a role in transactions. No one will be able to get off the hook by saying: “We can’t control who our counterparty does business with.”

In addition, the requirement goes beyond transactions in the United Kingdom. It includes other countries that are party to the Travel Rule. And firms wil

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Author: Michael Washburn

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