EU agrees clampdown on bitcoin platforms to tackle money laundering
EU agrees clampdown on bitcoin platforms to tackle money
laundering
By Francesco Guarascio DECEMBER 15, 2017 / 9:20 AM
BRUSSELS (Reuters) - European Union states and
legislators agreed on Friday on stricter rules to prevent money laundering and
terrorism financing on exchange platforms for bitcoin and other virtual
currencies, the EU said in a statement.
The agreement is part of a broader set of measures to
tackle financial crimes and tax evasion. EU legislators also backed stricter
controls on pre-paid cards, and raised transparency requirements for the owners
of trusts and companies.
“Today’s agreement will bring more transparency to
improve the prevention of money laundering and to cut off terrorist financing,”
Europe’s Justice Commissioner Vera Jourova said.
The EU decision comes as bitcoin’s prices have risen more
than 1,700 percent since the start of the year, triggering worries that the market
is a bubble that could burst in spectacular fashion.
The agreed measures will end anonymous transactions on
virtual currency platforms and with pre-paid payment cards, which investigators
said could have been used to fund attacks by militants.
Bitcoin exchange platforms and “wallet” providers that
hold the cyber currency for clients will be required to identify their users,
under the new rules which now must be formally adopted by EU states and
European legislators and then turned into national laws within 18 months.
It took EU legislators more than a year of negotiations
to agree on the legislative proposals, put forward by the European Commission
in the wake of shooting and bombing attacks in Paris and Brussels in 2015 and
2016 which killed more than 160 people.
The talks dragged on because some EU states opposed
increased transparency on trusts and companies, fearing a negative impact on
their economies.
The EU lawmaker in charge of the issue, Dutch Green
Judith Sargentini, said Britain, Malta, Cyprus, Luxembourg and Ireland were
among those opposing the changes. The deal allows the authorities and “persons
who can demonstrate a legitimate interest” to access data on the beneficial
owners of trusts.
Trusts are legitimate financial vehicles to manage assets
but have sometimes been accused of hiding illegal activities because of their
lack of transparency.
Transparency International, a rights group, called the
deal “a breakthrough” but lamented the fact that data on trusts’ owners will
not be completely public, as it will be for beneficial owners of companies. The
increased public scrutiny is considered essential by the EU commission and also
by rights groups, to prevent financial crimes and tax evasion.
Additional reporting by Alissa de Carbonnel; Editing by
Foo Yun Chee and Peter Graff
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