Treasury Department warns banks to be 'vigilant' of Russian oligarchs and government officials using cryptocurrency to evade sanctions
- The US Treasury sent out an alert on Monday outlining "red flags" of potential
- It told banks to "be vigilant" of Russian
oligarchsand state actors attempting to skirt sanctions.
The US Treasury Department issued a Financial Crimes Enforcement Network (FinCEN) alert on Monday that instructed financial institutions to be "vigilant" of Russian oligarchs and state actors attempting to dodge sanctions with
The department's advisory comes amid rising concern that the decentralized and anonymous nature of digital currencies like bitcoin could undermine US national security efforts.
"In the face of mounting economic pressure on
The alert highlighted several vulnerable industries, including Wall Street, real estate, casinos, banks, and insurance and jewelry companies.
While the Treasury Department has not seen widespread use of cryptocurrency in sanctions evasion, it warned that sanctioned individuals may use crypto wallets to attempt illegal transactions. The alert said that this is more likely than the Russian government using cryptocurrency to evade sanctions on a large scale.
In addition to traditional financial institutions, FinCEN asked virtual currency "exchangers and administrators" to report suspicious activity. According to regulatory documents, this includes businesses involved in the exchange, issuing of, or redeeming of cryptocurrency,
On Monday — the same day the alert went out — San Francisco-based crypto exchange Coinbase announced it had blocked 25,000 accounts linked to Russian users that it said it believed were involved in illicit activity.
"Sanctions play a vital role in promoting national security and deterring unlawful aggression, and Coinbase fully supports these efforts by government authorities," Coinbase said.
The exchange said digital assets can enhance the ability to detect and deter evasion compared to physical money laundering with shell companies.
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