Cyprus is in the spotlight in the week’s headlines, whilst the FCA broadens financial crime reporting obligations to include crypto assets.
Criminals and refugees have been able to purchase “golden passports” from Cyprus, giving them access to financial services across the EU.
Whilst Cyprus opens the doors to criminals, the FCA looks to extend reporting responsibilities to crypto asset exchange providers.
The FCA’s actions come as fraudsters begin to encourage people to invest in cryptocurrencies and unregulated products such as diamonds and gold.
Find out more on these stories below.
Cyprus sold passports to criminals and fugitives
Convicted fraudsters, money launderers and political figures accused of corruption are among dozens of people from more than 70 countries who have bought so-called "golden passports" from Cyprus, according to a large cache of official documents obtained by Al Jazeera's Investigative Unit.
Passports from the Republic of Cyprus can be important for individuals from countries that have restricted access to Europe, as Cyprus is a member of the European Union (EU) and a passport offers its holder access to free travel, work and banking in all 27 member states.
"It's high value for everyone who comes from a country where there's a lot of dirty money involved", German MEP Sven Giegold, a strong critic of the programme, told Al Jazeera.
"You open a bank account, a business relationship and less questions asked, no visa requirements, easier to get access to get everywhere to travel than if you are from Russia, China or even more doubtful countries."
Cyprus has since introduced tougher rules on who is eligible for citizenship, and they have passed a law that allows them to remove citizenship after scandals involving “golden passport” holders.
UK FCA wants to include crypto firms in financial crime reporting rules
In a consultation paper published this month, the Financial Conduct Authority (FCA) proposed broadening annual financial crime reporting obligations to include all crypto asset exchange and custodian wallet providers.
The regulator says that by extending its reporting rules to a wider range of firms, it will be able to deepen its understanding of which firms may have intrinsic money laundering risks due to their activities.
The paper claims that the information provided through more inclusive annual reports will help the FCA’s supervisory approach in the financial sector to become more “data-led.”
The regulator estimates that by extending reporting obligations to a wider range of firms, including crypto asset service providers, it will acquire data for an additional 4,500 firms annually.
These changes in regulations show that the FCA is taking a risk-based approach towards tackling financial crime and money laundering.
Scammers use lockdown to ramp up bank fraud
Reports of fraud increased nearly sixfold among Barclays customers last month as the spike in scams reported by the bank during lockdown accelerated still further.
The bank received 465 reports of fraud in July 2019 compared with 2,699 cases last month, after cases rose 66 per cent in the first six months of the year. It said the July increase was partly down to changes in its reporting system.
Jim Winters, head of fraud at Barclays, said: “There has been a bounce-back effect from fraudsters kicking into action after lockdown ended.”
These fraudsters are encouraging people who are worried about low interest rates on savings accounts to invest money in private companies, cryptocurrencies and unregulated products such as gold, diamonds and graphene.
It seems that the lockdown has given criminals the time to think about how to approach future victims, and now they are more ready than ever.
Looking to fortify your AML defences?
Get in touch with one of our experts, or request a demo to see our award-winning technology in action
.png)
