Virtual Assets - Red Flag Indicators
Paris, 14 September 2020 - Virtual assets use innovative technology to swiftly transfer value around the world and have many potential benefits, including making payments faster and cheaper. But the anonymity associated with them also attracts criminals, who have used virtual assets to launder proceeds from a range of offences such as the drugs trade, illegal arms smuggling, fraud, tax evasion, cyber attacks, sanctions evasion, child exploitation and human trafficking.
In response, the FATF Report Virtual Assets - Red Flag Indiciators of Money Laundering and Terrorist Financing will help national authorities detect whether virtual assets are being used for criminal activity. Based on more than 100 case studies collected by members of the FATF Global Network, it highlights the most important red flag indicators that could suggest criminal behaviour. Key indicators in this report focus on:
This report will help virtual asset service providers, financial institutions, and designated non-financial businesses and professions, and other reporting entities detect and report suspicious transactions. It will also provide useful information for financial intelligence units, law enforcement agencies, prosecutors and regulators to analyse suspicious transaction reports or monitor compliance with anti-money laundering and counter-terrorist financing controls.
This report complements the FATF guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers (June 2019) which explains how to understand the money laundering and terrorist financing risks of virtual assets, how to license and register the sector, actions sectors need to take to know information about their customers, how to store this information securely, and how to detect and report suspicious transactions.
Also available in:
Russian - translation provided by ITMCFM: Russian Language - Virtual Assets Red Flag Indicators of Money Laundering and Terrorist Financing
Spanish - translation provided by GAFILAT with the support of Mexico: GAFILAT-Spanish-Virtual Assets-Red Flag Indicators