LAW360 - Carol Van Cleef

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    DC Partner Carol Van Cleef spoke with Law360 regarding the indictment of Liberty Reserve and its founder for allegedly running a $6 billion money-laundering scheme. According to the piece, the indictment may have revealed the U.S. government’s interest in exposing the ”dark side” of digital currencies and signaled what steps firms hoping to legitimize the expanding market should take to avoid the government’s hammer. The U.S. Department of Treasury designated Liberty Reserve as a “financial institution of primary money laundering concern” under the 2001 USA PATRIOT Act, enabling the department to take so-called special measures against the company. The designation bars financial institutions operating in the U.S. from any relationship with Liberty Reserve. “The special measures authority is used very rarely and has never been used with a currency transmitter,” said Ms. Van Cleef in the article, stating that the requirement that exchange platforms register as money transmitters could be a way for law enforcement to standardize anti-money laundering practices at digital currency exchanges. “This is definitely a road map,” she added.

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