A pair of nominees for the U.S. Treasury Department pledged to, if confirmed, ensure new anti-money laundering (AML) regulations involving cryptocurrencies would be implemented.
President Joe Biden (D) nominated Brian Nelson to be Under secretary for Terrorism and Financial Crimes and Elizabeth Rosenberg to be assistant secretary for Terrorist Financing earlier this year. The Senate Banking Committee held a confirmation hearing on Tuesday to debate their nominations, addressing different issues around financial crimes and whether or not crypto plays a role.
In response to Sen. Catherine Cortez Masto (D-Nev.) asking the nominees how they would limit the damage from crypto-related crimes, Nelson noted the Anti-Money Laundering Act of 2020, a bill passed into law last year, already tasks the Financial Crimes Enforcement Network (FinCEN) with applying new crypto-related regulations.
"Obviously this is an issue that was [and] has been a great concern for some time now, and it's reflected in the new Anti-Money Laundering Act that this committee really championed," he said. If confirmed he said he "would prioritize implementing pieces of that legislation including new regulations around cryptocurrency."
The Treasury Department's Terrorist Financing and Financial Crimes office would have to work with its international partners to address crypto crimes, he added.
Likewise, Rosenberg noted that international cooperation is needed to tackle cryptocurrency-related crimes. She said she would "seek to ensure" that any cryptocurrency regulations are both appropriate and consistent across different jurisdictions.
Part of TFFC's mission is to coordinate with international offices to ensure different nations all have similar regulatory regimes, she said.
"Without that kind of collaboration and … regulatory framework, it's all too easy for criminals to avoid the U.S. jurisdiction and conduct their illegitimate activity from another jurisdiction," she said.
The nominees' comments reflect a growing level of scrutiny around the role cryptocurrencies play in different sorts of crimes. Treasury Secretary Janet Yellen repeatedly brought up concerns around crypto use in terrorist financing during her own confirmation process, and recent ransomware attacks have drawn further attention to cryptocurrencies.
"It reflects a balancing of regulating to prevent virtual currency and other types of new technology from undermining our AML system while also being respectful of the fact that we need to support responsible innovation and preserve that here in the U.S. and not see that leave the country," Nelson said.
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