The FCA has become the anti-money laundering and counter terrorist financing (AML/CTF) supervisor for businesses carrying out certain cryptoasset activities under the amended Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLRs).
It means that any UK business conducting specific cryptoasset activities falls within scope of the regulations and will need to comply with FCA requirements.
The body has outlined that amongst other things, it’s requiring cryptoasset businesses to identify and assess the risks of money laundering and terrorist financing which their business is subject to, implement policies, systems and controls to mitigate the risk of the business being used for the purposes of money laundering or terrorist financing.
In placing a heightened focus on the safety of cryptoasset activities, the FCA has also emphasised: “New businesses carrying out cryptoasset activity in scope of the MLRs must be registered with the FCA before conducting businesses. You can find out more about the registration process on our website.
“Existing businesses already conducting cryptoasset activity before 10 January 2020 may continue their business but will need to ensure their compliance with the MLRs with immediate effect.
“All existing businesses undertaking cryptoasset activities must be registered by January 2021. To ensure this deadline is met, these businesses must submit a completed application for registration via 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.”
Highlighting an elevated level of seriousness to its role in overseeing the sector, the FCA underlined that it would proactively supervise firms’ compliance with the new regulations, as well as being sure will take swift action where firms fall short of desired standards and cause risks to market integrity.
