Department of Justice warns financial institutions about Bitcoin

Regulation | July 7, 2015 By:

Assistant Attorney General Leslie Caldwell sent a targeted warning to financial institutions that deal with Bitcoin and other virtual currencies.

Caldwell noted that virtual currencies are attractive to criminals because the transactions transfer quickly, securely and with a level of anonymity. Additionally, the lack of oversight by a central financial authority or other governmental agencies attracts cross-border criminals who favor both the immediate lack of personal identifying information and irreversibility of the payments.

Caldwell highlighted the recent life sentence imposed on “Silk Road” mastermind Ross Ulbricht, who ran an underground website that allowed drug dealers to sell their goods online as an example of the illicit misuse of crypto-currencies.

While acknowledging the legitimate uses of virtual currency, she noted that the increasing misuse of virtual currency, especially on the internet, will be aggressively pursued by the Department of Justice.