Treasury Department to Combat Illicit Finance with Automation and Innovation

The Treasury Department’s 2024 national illicit finance strategy, released on May 16, emphasises closing regulatory gaps to combat money laundering in the U.S. banking system. This strategy continues the work of enhancing the anti-money laundering (AML) and countering the financing of terrorism (CFT) frameworks.

Titled “National Strategy for Combating Terrorist and Other Illicit Financing,” the strategy outlines ongoing efforts in the cryptocurrency space, including penalties on exchanges like Bitzlato and Lazarus, agreements with Binance, and alerts about “pig butchering” schemes. It focuses on four core areas: closing AML loopholes, updating virtual asset frameworks, enhancing risk-focused supervision, and improving law enforcement and international cooperation.

Key priorities include addressing legal and regulatory deficiencies, advancing a risk-based AML/CFT framework, improving operational effectiveness, and leveraging technology. Specific actions involve completing vulnerability assessments for high-risk industries, operationalizing the beneficial ownership information register, and finalising regulations for the residential real estate and investment adviser sectors.

The strategy also highlights the use of technology to combat illicit financing, such as by developing new payment technologies, endorsing innovative compliance protocols, and using automation to detect and prevent issues. These measures aim to enhance national security and economic stability, though they may present challenges for financial institutions adapting to new regulations and balancing privacy concerns with security needs.


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