On October 9, 2020, the US Department of Justice published a comprehensive outline of crypto enforcement framework. According to an announcement by the DOJ, the Cyber-Digital Task Force, created by AG William Barr, created the framework.
Details of the Publication
The Cyber-Digital Task Force released a report titled “Cryptocurrency: An Enforcement Framework.” In the report, the task force noted that while the technology has only been around for a brief period, it plays a role in many of the significant national security and criminal threats the US faces. The task force categorized illegal uses of crypto into three categories:
- Financial transactions related to criminal activity
- Money laundering and obscuring legitimate activities from taxation, reporting, or other legal obligations
- Direct crimes such as crypto theft within the crypto market
The task force members plan to adapt their strategies and tools to the 21st-century financial world, including fighting the use of crypto to evade the law and harm the US national security. Some of the specific crimes cited in the document include pump-and-dump schemes, terror financing, malicious cyber activities, and money laundering.
In the report, it is noted that the blockchain usually exceeds international borders. It also noted that some of the largest crypto exchanges in the world operated outside the US. Consequently, enforcing the law was a challenge for US law enforcement.
The DOJ Outlines Its Goal
The report states that the Enforcement Network faces significant challenges that need to be overcome. However, it notes that the Department of Justice also has a wide array of resources, and so does the US government. It states that it will dedicate itself to overcoming these challenges in collaboration with international partners.
What Top Officials Had To Say
While commenting on the Enforcement Framework, Attorney General William Barr said that cryptocurrency could transform how humanity interacts and organizes society. William Barr also added it was crucial to ensure it did not negatively affect the public safety and national security of the US and its allies.
He concluded by saying he was grateful for the Cyber-Digital Task Force for producing the report. The report would provide a cohesive framework for those who wish to understand the priorities of federal enforcement in the space.
Christopher Wray, the Director of the FBI, also commented on the framework. He said that at the FBI, they had seen firsthand the danger posed by criminals who use digital assets. In the past, they had witnessed criminals leveraging crypto in an attempt to hide their illegal transactions and trade in illegal goods.
Wray gave the example of ransomware in the form of criminals infecting computers and servers with the ultimate goal of collecting cryptocurrency from victims. These attacks threaten to block data on ones computer until they agree to send a certain amount of crypto to the criminal. In some cases, the criminals threaten to disperse confidential or embarrassing information on the victim if they do not comply. He concluded by stating that the members of the FBI were constantly innovating to keep up with criminals using digital assets.
Commenting on the issue, the acting Assistant Attorney General for the Criminal Division, Brian C. Rabbitt, said that crypto and the DLT held great potential for the future. However, the innovations needed to remain within the law.
The report by the task force details clear Enforcement Framework for dealing with crimes involving cryptocurrencies. It could help to deter criminals by ensuring that law enforcement will be fully aware and prepared to deal with various crimes in the digital asset space moving forward.
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