Anika Begay
U.S. senators believe the president’s bodyguards could do more than wield high-powered guns and wear stylish dark glasses. Lawmakers have introduced a measure that would give the Secret Service the power to investigate and prosecute crimes that use digital assets in a bipartisan effort.
In an effort to curb the growing threat of illicit money and the use of cryptocurrencies by criminals, the 2024 Anti-Money Laundering and Cybercrime Act has been proposed.
Peculiarities of the proposed law
Senators Amy Klobuchar (D-Minn.), Chuck Grassley (R-Iowa), and Catherine Cortez Masto (D-Nev.) introduced the bill, which would grant the Secret Service greater investigative powers to investigate crimes involving digital assets, such as financial institution fraud, structured transactions, and unlicensed money transmission businesses.
My new bill with @ChuckGrassley provides intelligence agencies with the tools to investigate criminal organizations that use digital resources to evade the law.
Intelligence agencies play a vital role in fighting financial crime and our bill will ensure they continue to keep us safe.
— Senator Cortez Masto (@SenCortezMasto) August 4, 2024
This would allow the Secret Service to investigate crimes against digital assets, such as fraud committed by financial institutions, structured transactions and unlicensed money transfer companies.
Senator Masto highlighted the clear and present danger to the nation’s security posed by the financing of illegal operations through digital assets. The bill requires a Government Accountability Report (GAR) within one year to assess the effectiveness of law enforcement in detecting and deterring money laundering.
Total crypto market cap at $1.8 trillion on the daily chart: TradingView.com
Strengthening the capabilities of the secret services
Cryptocurrencies present new avenues that led to the proposal of this measure. To successfully prosecute “shady financial firms” that promote money laundering and other illicit activities, Senator Grassley stressed the need for improved threat assessments.
Since 2004, the Secret Service’s Cyber Investigative Section has operated as an internal unit focused on combating cybercrime. In an effort to improve cooperation and expertise in investigating financially motivated cybercrime, the agency announced the establishment of its Cyber Fraud Task Forces in 2020, merging its Electronic Crimes Task Forces and Financial Crimes Task Forces.
Greater efforts and bipartisan support
Nine lawmakers introduced a measure similar to CMLC2024 in January. This support from both major parties underscores the critical need for new guidance to address the risks associated with the rapidly expanding digital currency market.
Masto is attempting to address the issue of cryptocurrency and money laundering for the second time in a year with its new legislation. It introduced a bill in September last year to close loopholes and ensure that cryptocurrency firms comply with government regulations related to counterterrorism financing and anti-money laundering.
Chainalysis estimates that in 2023, illicit addresses laundered more than $22 billion in cryptocurrency, down about 30% from $31.5 billion in 2022.
The U.S. Treasury has emphasized that cash is still the primary tool used for money laundering in the United States, despite this significant amount. However, in recent years, government agencies such as the U.S. Treasury, the Department of Justice, the SEC, and the CFTC have waged an aggressive war against cryptocurrency criminals.
Featured image from Secret Service, chart from TradingView
