FATF guidance relating to the Travel Rule for VAs and VASPs
The Financial Action Task Force (FATF) is an inter-governmental body whose mandate is to set standards and to promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and the financing of proliferation, and other related threats to the integrity of the international financial system.
The FATF Recommendations set out a comprehensive and consistent framework of measures, an international standard, which countries should implement through measures adapted to their particular circumstances.
With regards to Virtual Assets and Virtual Asset Service Providers, two recommendations are of particular relevance:
R. 15: New Technologies
Details
Refer to the Interpretive Note to Recommendation 15 (INR 15) in the The FATF Recommendations. Some excerpts below:
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Countries should apply the relevant measures under the FATF Recommendations to virtual assets and virtual asset service providers (VASPs).
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Countries should ensure that VASPs are subject to adequate regulation and supervision or monitoring for AML/CFT and are effectively implementing the relevant FATF Recommendations, to mitigate money laundering and terrorist financing risks emerging from virtual assets.
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With respect to the preventive measures, the requirements set out in Recommendations 10 to 21 apply to VASPs, subject to the following qualifications:
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(a) R. 10 – The occasional transactions designated threshold above which VASPs are required to conduct CDD is USD/EUR 1 000.
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(b) R. 16 – Countries should ensure that originating VASPs obtain and hold required and accurate originator information and required beneficiary information42 on virtual asset transfers, submit43 the above information to the beneficiary VASP or financial institution (if any) immediately and securely, and make it available on request to appropriate authorities. Countries should ensure that beneficiary VASPs obtain and hold required originator information and required and accurate beneficiary information on virtual asset transfers and make it available on request to appropriate authorities. Other requirements of R. 16 (including monitoring of the availability of information, and taking freezing action and prohibiting transactions with designated persons and entities) apply on the same basis as set out in R. 16. The same obligations apply to financial institutions when sending or receiving virtual asset transfers on behalf of a customer.
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R. 16: Wire Transfers
Details
Refer to the Interpretive Note to Recommendation 16 (INR 16) in the The FATF Recommendations. Some excerpts below:
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Recommendation 16 applies to cross-border wire transfers and domestic wire transfers, including serial payments, and cover payments.
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Countries may adopt a de minimis threshold for cross-border wire transfers (no higher than USD/EUR 1,000), below which the following requirements should apply:
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(a) Countries should ensure that financial institutions include with such transfers:
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(i) the name of the originator;
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(ii) the name of the beneficiary; and
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(iii) an account number for each, or a unique transaction reference number. Such information need not be verified for accuracy, unless there is a suspicion of money laundering or terrorist financing, in which case, the financial institution should verify the information pertaining to its customer.
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(b) Countries may, nevertheless, require that incoming cross-border wire transfers below the threshold contain required and accurate originator information.
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For a comprehensive overview, see the section titled Overview of R.16 and its application to VAs and VASPs in the FATF Updated Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers published 28-Oct-2021.
Articles
| Published | Article |
|---|---|
2022-06-30 |
Targeted Update on Implementation of FATF’s Standards on VAs and VASPs |
2021-10-28 |
Updated Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers |
2021-07-05 |
|
2020-07-07 |
|
2019-06-21 |
Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers |
2022-03 last updated |
The FATF Recommendations. Adopted on 16-Feb-2012 and updated since. |
Further reference
Alessa maintains an up to date blog article with new information as it becomes available: The Latest FATF Advisories and Guidance