ICBA: More needs to be done to curtail crypto scams

ICBA said it strongly supports a Financial Crimes Enforcement Network proposed rule to designate the Huione Group as a primary money laundering concern, but it said more needs to be done to curtail the rapid growth of crypto scams.

Details: In a comment letter on FinCEN’s proposal to sever the Cambodia-based conglomerate’s connections to the U.S. financial system, ICBA:

• Asked FinCEN to consider additional actions that recognize the key role of social media and telecom companies in the spread of scams and to work with partners across the government to compile better data about the scams.

• Called on FinCEN to consider additional punitive measures to cut off North Korea’s ability to launder stolen crypto assets.

• Urged FinCEN to finish the work it started in 2023 to classify transactions involving crypto mixing as a primary money laundering concern.

Background: FinCEN last month said the Huione Group serves as a critical node for laundering proceeds of cyber heists carried out by North Korea and for transnational criminal organizations in Southeast Asia perpetrating convertible virtual currency investment scams such as “pig butchering.”

Growing Concern: Losses attributed to crypto crimes increased 66% in 2024 to $9.3 billion, according to a recent report from the FBI’s Internet Crime Complaint Center.

ICBA View: In a statement for a congressional hearing on crypto-based romance confidence scams last fall, ICBA said the persistent growth of such scams emphasizes the urgent need for policymakers to prioritize national security, counter illicit finance uses of cryptocurrency, and improve information sharing with community banks. ICBA also supported FinCEN’s effort in 2023 to classify transactions involving crypto mixers as a primary money laundering concern and subject them to additional reporting.

Resources: ICBA blog posts spotlight the growth of these scams and the need for a policy response.