One of the financial regulators of Switzerland informed the country is “particularly presented” to money laundering dangers given its traditional position as a magnet for the world’s prosperous as well as rising threats from blockchain and banks’ lower gain margins.
Finma Chief Executive Officer Mark Branson told reporters in Zurich on Tuesday that they want to give them a chance and they have done a lot to eliminate additional restrictions to approve projects based on digital currencies, but they are also not starry-eyed as these new business models come with new risks or old ones in new shapes.
Blockchain, which provides a digital record of all transactions on it, may tempt banks with efficiency gains but its anonymity and speed appeals to money launderers, the regulator warned in its 2019 Risk Monitor report.
Three years ago, the cybercriminals who hacked critical infrastructure around the world using the notorious computer virus WannaCry then turned to Zug-based crypto exchange to launder their criminal gains. That indicates Finma has to be just as vigilant to new and old techniques for hiding dirty money.
Branson said: “When we talk about blockchain applications or payment systems, it’s clear that money laundering risks exist and are an important risk category for this kind of business model. The same risks have to be supervised and regulated with the same intensity, new and old”.