Anti-money laundering (AML) measures have been a cornerstone of financial regulations worldwide. In fact, they share a global importance because money laundering often occurs between borders.
With the rise of cryptocurrencies - a decentralised system that specifically promotes frictionless (and often anonymous) cross-border transactions - there's a pressing need to understand and implement AML specifically tailored for this.
Cryptocurrencies’ benefits and their unique selling points are the very things that make them so dangerous, too. And, considering their rapid rate of evolution, it presents unique challenges that traditional financial systems haven't faced before.
Why is AML Crucial for Crypto Assets?
Cryptocurrencies offer unparalleled privacy and decentralisation. However, this can be exploited by malicious actors. The lack of identification and verification checks on cryptocurrency transactions can lead to fraudulent activities because KYC doesn’t necessarily apply when opening some types of wallets.
AML for cryptocurrencies therefore isn't just about compliance; it's about building trust and ensuring the longevity of the crypto market. Currently, legitimising and normalising crypto assets is the shared goal of many invested individuals and companies.
The UK's Stance on Crypto AML
The UK has been proactive in addressing the challenges posed by cryptocurrencies. The Financial Conduct Authority (FCA) supervises UK crypto-asset businesses under money laundering regulations, and the FCA is one of the strictest, most respected regulators in the world.
Any crypto-asset business intending to operate in the UK must register with the FCA and adhere to the stipulated guidelines, ensuring that their operations are transparent and above board. Unfortunately, it’s a necessity for the FCA to continuously update their regulations because the technology and its use cases are quickly changing. As a result, businesses must stay on top of the latest FCA regulatory changes, meaning that compliance is an ongoing endeavour.
5 Things to Remember With AML Compliance
- FCA Registration: UK crypto-asset businesses must now register with the FCA. It's a legal mandate, not an endorsement
- Supervisory Powers: the FCA uses a risk-based approach and has powers to direct and review crypto businesses for compliance
- Reporting Obligations: firms must provide specific information to the FCA, ensuring transparency and accountability
- Customer Due Diligence: firms should conduct thorough checks on customers, with enhanced scrutiny for high-risk individuals
- Disclosure Requirements: businesses must inform customers if they aren't covered by the Financial Ombudsman Services or FSCS
Benefits of AML Compliance for Crypto Businesses
As mentioned, this ongoing endeavour for compliance shouldn’t be seen as an ongoing battle. It’s not about sidestepping obstacles like penalties and laws; it’s an opportunity for a business to grow its reputation, improve its workforce, and operate a secure business.
AML-compliant crypto businesses foster trust and transparency with their customers in a market that severely lacks trust - and rightly so. Customers have the default position of scepticism because of the ongoing scandals that have arisen from a lack of compliance or regulations, along with the technology being in its infancy.
Anti-money laundering for crypto not only lowers the risk of financial crime but also plays a pivotal role in stabilising the crypto market. Businesses that are compliant can confidently expand their operations, knowing they are on the right side of the law.
Tailored AML Training for Crypto Assets
In the rapidly changing world of cryptocurrencies, staying updated and compliant is not just a necessity; it's a competitive advantage. Recognising this need, we have meticulously crafted the AML Essentials for Crypto Assets course to offer professionals a comprehensive understanding of AML in the crypto context.
The AML Essentials for Crypto Assets will cover:
- The Money Laundering and Terrorist Financing Regulations 2017
- The Proceeds of Crime Act 2002
- The Terrorism Act 2000 and more
- The structural protections companies should put in place for compliance
- How to identify warning signs and red flags
- Conducting due diligence
- The responsibilities individuals have in crypto asset firms regarding AML
Ultimately, there’s only one way to ensure AML compliance, and that is holistic and thorough employee training that is intentionally designed for crypto asset firms. Here's why AML training at Englebert is a game-changer:
Comprehensive Curriculum: The course covers the A-Z of AML for cryptocurrencies. From understanding the foundational principles of AML to diving into the unique challenges posed by crypto transactions, the curriculum ensures a holistic understanding. It doesn't just stop at theory; it goes deep into real-world scenarios, case studies, and practical applications.
Tailored for the UK Regulatory Landscape: Given the UK's distinct stance on cryptocurrencies and its specific regulatory guidelines, a generic global course won't suffice. This training is tailored to the UK's laws and regulations, ensuring that professionals are equipped to navigate the UK landscape confidently.
Tailored for Crypto Assets: General AML is well-established, with many companies offering training. However, a tailored AML course for crypto assets specifically is necessary, because these differ greatly from traditional companies.
Experts in Compliance: Learning from the best is crucial. The course has been designed by expert instructors who bring to the table not just theoretical knowledge but practical experience in the crypto and financial sectors. The insights and hands-on approach ensure that learners get more than just textbook knowledge.
Up-to-date Material: The crypto world is dynamic, and what's relevant today might be obsolete tomorrow. Recognising this, the course is up-to-date on the recently changed laws at the FCA. Enrollees get access to recent materials, ensuring they remain at the forefront of knowledge.
In conclusion, the AML Essentials for Crypto Assets course isn't just another training program. It's a comprehensive and dynamic learning experience designed to equip professionals with the knowledge, skills, and network they need to excel in the crypto world.
Regulatory training for employees may require a more bespoke approach than a pre-made course. Englebert also offers the chance to have bespoke training sessions for both small and large groups, be it online or in-person. These can better incorporate interactivity too, such as group discussions and workshops.