MENLO PARK, Calif.—Large banks might be processing as much as $2 billion in unnoticed crypto-related transfers annually, a new report suggests.
CipherTrace alleges that its research unit has discovered that all the top 10 commercial banks in the United States have unregistered crypto businesses that use their payment networks to process funds, Crypto Vibes reported.
While both the Financial Action Task Force (FATF) and U.S. Bank Secrecy Act funds Travel Rules need banks to identify the money services businesses (MSBs) using their networks by law, CipherTrace alleges that most are ill-equipped to adequately identify crypto exchanges together with other virtual asset service providers (IDPs) as MSBs, Crypto Vibes said.
According to the revised FATF and BSA guidance, it is expected to make identification and compliance more critical. The guidance will soon come into effect for the G20 nations. During the November 2019 San Francisco CipherTrace Cryptocurrency Travel Rule Information Sharing Architecture Conference, Carole House of the U.S. Treasury’s Financial Action Task Force (FinCEN) raised various concerns, Crypto Vibes noted.
“It would be interesting to know how many financial institutions operating in this space can identify a [crypto-business] recipient as a financial institution based on its wallet reference number, or other information that it currently has available to it,” House said.