UPDATED GUIDANCE: A RISK-BASED APPROACH TO VIRTUAL ASSETS AND VIRTUAL ASSET SERVICE PROVIDERS 41
© FATF/OECD 2021
country as well as risk mitigation strategies that account for the cross-border
element of VA activities (e.g., cross-border VA payments or transfers) and VASP
operations. Countries should periodically revisit the risk assessment basis
underpinning this decision, as the associated ML/TF risks and the ability to enforce
such a prohibition/limitation may evolve rapidly.
110. Recommendation 2 requires national co-operation and co-ordination with respect
to AML/CFT/CPF policies, including in the VASP sector, and is therefore indirectly
applicable to countries in the context of regulating and supervising covered VA
activities. Countries should consider putting in place mechanisms, such as
interagency working groups or task forces, to enable policymakers, regulators,
supervisors, the FIU, and law enforcement authorities to co-operate with one
another and any other relevant competent authorities in order to develop and
implement effective policies, regulations, and other measures to address the
ML/TF/PF risks associated with covered VA activities and VASPs. This should
include co-operation and co-ordination between relevant authorities to ensure the
compatibility of AML/CFT requirements with data protection and privacy rules and
other similar provisions (e.g., data security/localisation). National co-operation and
co-ordination are particularly important in the context of VAs, in part due to their
highly-mobile and cross-border nature and because of the manner in which covered
or regulated VA activities may implicate multiple regulatory bodies (e.g., those
competent authorities regulating money transmission, securities, and commodities
or derivatives activities). Further, national co-operation relating to VA issues is vital
in the context of furthering investigations and leveraging various interagency tools
relevant for addressing the cyber and/or VA ecosystem.
Treatment of Virtual Assets: Interpreting the Funds- or Value-Based Terms
111. For the purposes of applying the FATF Recommendations, countries should
consider all funds- or value-based terms in the Recommendations, such as
“property,” “proceeds,” “funds,” “funds or other assets,” and other “corresponding
value,” as including VAs. In particular, countries should apply the relevant measures
under Recommendations 3 through 8, 30, 33, 35, and 38, all of which contain
references to the aforementioned funds- or value-based terms or other similar
terms, in the context of VAs in order to prevent the misuse of VAs in ML, TF, and PF
and take action against all proceeds of crime involving VAs. The aforementioned
Recommendations—some of which may not at first appear directly applicable to
VASPs and similarly obliged entities but are in fact applicable in this space—relate
to the ML offence, confiscation and provisional measures, TF offence, targeted
financial sanctions, non-profit organisations, law enforcement powers, sanctions,
and international co-operation.
112. Recommendation 3. For the purposes of implementing Recommendation 3, the ML
offence should extend to any type of property, regardless of its value, that directly
represents the proceeds of crime, including in the context of VAs. When proving that
property is the proceeds of crime, it should not be necessary that a person be
convicted of a predicate offence, including in the case of VA-related proceeds.
Countries should therefore extend their applicable ML offence measures to
proceeds of crime involving VAs.
113. Recommendation 4. Similarly, the confiscation and provisional measures relating
to “(a) property laundered, (b) proceeds from, or instrumentalities used in or
intended for use in money laundering or predicate offences, (c) property that is the