Taiwan Bans Anonymous Crypto Transactions

News, Regulation | November 5, 2018 By:

The government of Taiwan has amended its existing anti-money laundering (AML) and counter terrorism financing (CFT) laws to help combat crypto crimes.

On Friday, the Legislative Yuan, Taiwan’s highest legislative body, passed amendments to the Money Laundering Control Act and the Terrorism Financing Prevention Act, which give Taiwan’s Financial Supervisory Commission (FSC) the authority to bar anonymous crypto transactions.

“The FSC can now demand that operators of virtual currency platforms, including bitcoin, implement “real-name systems” that require users to register their real names,” the new provisions stated. “If they don’t, banks can reject anonymous virtual currency transactions and report them to the FSC if they deem them suspicious.”

The Ministry of Justice (MoJ) said that the amendments align Taiwan more closely with international AML standards and makes the country’s AML system more complete. The changes will also support efforts to build a culture that values legal compliance.

“A compliance culture and mindset is an important part of effectively fighting money laundering, and that culture and mindset can only be fostered through good habits and practices in the operations of local companies and institutions,” the MoJ said.

In 2016, Taiwan amended the Money Laundering Control Act, but the MoJ said it has not fully prevented related financial crimes. The latest amendments are expected to better the country’s performance in its upcoming evaluation by Asia/Pacific Group on Money Laundering (APG), due to take place November 5-16.

Last month, Wellington Koo, chairman of the FSC, announced that Taiwan will be releasing draft initial coin offering (ICO) regulation by June 2019. At the time, the FSC said that tokens exchanged for goods, such as those used in accruing points at convenience stores or mileage points accepted by airlines, would not be covered by the regulation.