Virtual Assets [VA] Red Flags of Financial Crimes and Terrorist Financing
Virtual assets use innovative technology to transfer value worldwide swiftly 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 Indicators
- Technological features that increase anonymity - such as the use of peer-to-peer exchanges websites, mixing or tumbling services or anonymity-enhanced cryptocurrencies
- Geographical risks - criminals can exploit countries with weak or absent national measures for virtual assets
- Transaction patterns - that are irregular, unusual or uncommon, which can suggest criminal activity
- Transaction size – if the amount and frequency have no logical business explanation
- Sender or recipient profiles - unusual behaviour can suggest criminal activity
- Source of funds or wealth - which can relate to criminal activity
These Virtual Assets - Red Flag Indicators
This report complements the RBA for Virtual Assets & Virtual Asset Service Providers
Virtual Assets Red Flag - Financial & Non-Financial Sectors =
Virtual Assets Red Flag - Virtual Asset Service Providers =
Virtual Assets Red Flag - Public Sector =
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