2.FCA announced as AML supervisor for UK’s cryptoasset activities

Britain’s Financial Conduct Authority (FCA) is ready to play a bigger role in crypto matters, with new supervisory roles with regards to crypto assets activities under the corrected Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLRs). The news is published via  FCA News post on Jan 10, 2020.

FCA will supervise whether United Kingdom-enlisted businesses engaged in crypto asset-related operations are consistent with relevant regulations and requirements.

According to the Announcements, It require crypto asset businesses to:

• identify and assess the risks of money laundering and terrorist financing which their business is subject to;
• have policies, systems and controls to mitigate the risk of the business being used for the purposes of money laundering or terrorist financing;
• where appropriate to the size and nature of its business, appoint an individual who is a member of the board or senior management to be responsible for compliance with the MLRs;
• undertake customer due diligence when entering into a business relationship or occasional transactions;
• apply more intrusive due diligence, known as enhanced due diligence, when dealing with customers who may present a higher money laundering / terrorist finance risk. This includes customers who meet the definition of a politically exposed person;
• undertake ongoing monitoring of all customers to ensure that transactions are consistent with the business’s knowledge of the customer and the customer’s business and risk profile.

In placing a heightened focus on the safety of crypto asset activities, the FCA has also emphasised:

“Existing businesses already conducting crypto asset activity before 10 January 2020 may continue their business but will need to ensure their compliance with the MLRs with immediate effect.

To ensure this deadline is met, these organizations must submit a completed application for registration through Connect by June 2020. Existing Financial Services and Markets Act firms, e-money institutions or payment services businesses undertaking cryptoasset activity will also be required to apply for registration.