Opinion by: Mike Haley, CEO of Cifas
While the Crypto industry revolutionize the world of finance, an underlying reality below the surface is bubbling. Record level, hitting the cryptocurrency scams is allegedly responsible $ 9.9 billion In 2024 – also to read Blekar with a forecast of 2025.
Whether “chronic alcohol in new bottles” fraud-fraud such as Ponzi and Pump-And Dump Scheme or new Crypto-specific fraud typing, addresses such as poisoning toxicity-inferiority-inflammatory fraudulent epidemic industry are killing the difficult and reducing consumer trust.
Criminals are misusing the region to rob the fraud -fraud income generated in the traditional finance (Tradfi) region. It creates compliance challenges for firms developing anti-mani laundering (AML) rules. Eventually, about 90% of Crypto registration applications in the UK fail due to weak AML and fraud control.
Crypto sector abuse
This misuse of the Crypto sector is not being noticed by the hard working industry to clean its image in the eyes of global regulators, many of which are beginning to regulate the area beyond the AML perimeter. Efforts by individual firms – such as industry scam equipment and disruption operations – admirable although they can have a limited effect in isolation.
The industry requires a much more boulder approach to anti-financial crime data sharing.
Sharing cross-sector public-private data to deal with fraud is becoming an ideal in the rapid tradefit sector. Whether it is compulsory anti-scam data sharing between financial services and telcoses in Singapore, or among the voluntary schemes led by industry in Australia and the UK, data sharing is accepted globally as one of the major defense against global fraud.
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We can only make a dent in the wave of this global crime by joining the dots with a fraud value chain. As fraud is favorable for the new financial landscape internationally, what is missing in this series is the digital assets community. Bringing the community into existing data-sharing efforts will not only help in creating a strong ecosystem, but will also benefit the industry.
Principle for action
There are three things that the industry should do.
First, the current limited use of crypto as a mainstream payment medium means that the most committed crypto may not be present in criminal isolation. On-ramping between crypto and fiat currencies are important intervention points in the fight against off-ramping and off-ramping crypto-link fraud. To see the entire picture, neither with the side, shares efforts to fail to share the data.
Second, using Crypto in fraud laundering chain makes AML a challenge. The industry needs to make a defense against fraud income, with rifting regulators to cut exchanges and new rules. This cannot do so without the required data flow, which prevents individuals from entering their ecosystem, data, which should move it beyond the price chain.
https://www.youtube.com/watch?v=vlicokjsip8
Third, while digital assets are increasing willingness to deal with fraud within the community, compliance as a profession within the area is a newborn discipline. The industry will benefit from the experience of hard data and fraud prevention experts installed in other fields, for which the types of emerging fraud are “trading as always”.
While arguments in favor of cross-industry data sharing to prevent crypto-linked fraud are clear, what is needed to be to apply the principle?
Accelerated cooperation
The UK cross-sector provides a possible hospitality policy environment for the first forces of the industry in cross-sharing.
From a legal point of view, UK Privacy Regulatory, Information Commissioner Office, Recently Stated It is unevenly that “data protection is no excuse when fraud and scams dealing with scams.” It is particularly relevant to recent crimes, one of which saw that scammers stole $ 1.2 million to cheat the victims to disclose personal information as law enforcement and crypto wallet hosts.
https://www.youtube.com/watch?v=T06MVWZ6NGM
Data as coupled with recent legislative changes in data privacy rule (use and use) Work 2025 – Which establishes the prevention of crime as a “recognized valid interest” – the legal argument for sharing may not be clear.
Next, regulator for digital asset regulation in the UK provides carrots and sticks for prevention of fraud and data sharing. The announcement of the UK Chancellor on future regulation firmly states that digital assets industry will be bound by the same consumer protection rules. It is difficult to imagine UK consumer protection against fraud without cross-industry data-sharing element.
Carrots are also with the Financial Conduct Authority – and future digital asset regulators – said that data sharing is an important tool in the fight against fraud income.
Finally, the UK has a rich and established financial crime data-sharing ecology, including strong public-private, intra-industry and cross-sector collaboration with joint money laundering intelligence taskforce. Opening these initiatives for the digital assets industry has already begun, and with some government and regulatory support, it can be intensified.
Crypto and Digital Asset Community only knows the reputed and regulatory risks generated by the fraud emergency. But the recognition alone is not enough, and efforts should not be kept silent. Cross-industry data sharing is an important promoter of effective fraud prevention worldwide. Given the UK -friendly environment, it is specifically kept to lead for example.
By opinion: Mike Haley, CEO of Cifas.
This article is for general information purposes and is not intention and should not be taken as legal or investment advice. The ideas, ideas and opinions expressed here are alone of the author and not necessarily reflected or represented the ideas and ideas of the components.
