Virtual currency proposal lacks justification, reasonable comment period
The Financial Crimes Enforcement Network’s (FinCEN) proposal on convertible virtual currency transactions does not provide sufficient justification or a proper notice-and-comment period, CUNA wrote Monday. FinCEN’s proposal seeks to address certain AML threats posed by certain convertible virtual currency (CVC) and legal tender status digital asset (LTDA) transactions.
CUNA has noted in previous communications that FinCEN must strike the right balance between the imposition of costs on community credit unions and the benefit to law enforcement. In this instance, it is not clear that regulated entities have access to all the third-party information that is required to comply with this rule.
“In addition, a fifteen-day comment period over the course of an extended holiday season does not provide adequate time for interested parties to determine the impact of this proposal or how it fits into an otherwise effective AML program,” the letter reads. “Accordingly, CUNA encourages FinCEN to extend the comment period and provide adequate time for interested parties to ask questions, collect information and submit comments that will arm FinCEN with the data it needs to fully understand the ramifications of this rule.
“In the absence of such an extension of the comment period, FinCEN should adopt a rule with an extended mandatory compliance date and quickly promulgate clarifying regulatory or sub-regulatory guidance,” it adds.
The letter also calls on FinCEN to refrain from taking any enforcement actions against “covered entities that undertake reasonable, good faith efforts to comply with requirements contained in a final rule.”