An independent federal agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929 by proscribing it in the Section 4 of the Securities Exchange Act of 1933. The primary purpose of the SEC is to enforce the law against market manipulation.
(FINRA) Financial Industry Regulatory
A regulatory agency that assists the SEC in regulating financial markets. Registers broker-dealers eligible to solicit investments to investors. All state and federal investment advisor registrations are processed through FINRA’s Investment Advisor Registration Depository (IARD) system. FINRA administers licensing examinations from the securities financial markets.
A federal agency created by the Commodity Exchange Act of 1936 to regulate the commodities futures and commodities options markets in the United States. Absent an exemption, a Crypto Hedge Fund that trades commodities derivatives must register with the CFTC as a commodity pool operator (CPO) and its associated persons must pass the Series 3 examination. CFTC registration requires membership in the National Futures Association
IRS treats virtual currency as a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value and does not have legal tender status in the U.S.For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency.
For IRS, Bitcoin is one example of a convertible virtual currency. Bitcoin can be digitally traded between users and can be purchased for, or exchanged into, U.S. dollars, Euros, and other real or virtual currencies. The sale or other exchange of virtual currencies, or the use of virtual currencies to pay for goods or services, or holding virtual currencies as an investment, generally has tax consequences that could result in tax liability.
The IRS issued IRS Notice 2014-21, IRB 2014-16, as guidance on the tax treatment of transactions using virtual currencies. The IRS also published Frequently Asked Questions on Virtual Currency Transactions for individuals who hold cryptocurrency as a capital asset and are not engaged in the trade or business of selling cryptocurrency.
The Office of Foreign Assets Control ("OFAC") of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States. OFAC publishes lists of individuals and companies owned or controlled by, or acting for or on behalf of, targeted countries. It also lists individuals, groups, and entities, such as terrorists and narcotics traffickers designated under programs that are not country-specific.
A self-regulatory organization responsible for overseeing the U.S. derivatives industry, including on-exchange traded futures, retail off-exchange foreign currency and OTC derivatives. NFA is headquartered in Chicago and maintains an office in New York City.
FinCEN is a bureau of the U.S. Department of the Treasury. The Director of FinCEN is appointed by the Secretary of the Treasury and reports to the Treasury Under Secretary for Terrorism and Financial Intelligence. FinCEN’s mission is to safeguard the financial system from illicit use and combat money laundering and promote national security through the collection, analysis, and dissemination of financial intelligence and strategic use of financial authorities.
FinCEN receives financial transactions data; analyzing and disseminating that data for law enforcement purposes; and building global cooperation with counterpart organizations in other countries and with international bodies.
FinCEN exercises regulatory functions primarily under the Currency and Financial Transactions Reporting Act of 1970, as amended by Title III of the USA PATRIOT Act of 2001 and other legislation, whith legislative framework of the "Bank Secrecy Act" (BSA).
(FATF) Financial Action Task Force
The global money laundering and terrorist financing watchdog. The inter-governmental body sets international standards that aim to prevent illegal activities and the harm they cause to society. As a policy-making body, the FATF works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas. The FATF has developed the FATF Recommendations, or FATF Standards, which ensure a co-ordinated global response to prevent organised crime, corruption and terrorism. They help authorities go after the money of criminals dealing in illegal drugs, human trafficking and other crimes. The FATF also works to stop funding for weapons of mass destruction. The FATF monitors countries to ensure they implement the FATF Standards.
On March 2021 FATF has updates its Guidance on the risk-based approach to virtual assets (VAs) and virtual asset service providers (VASPs). The FATF originally published this Guidance in June 2019 when the FATF finalised changes to its Standards to clearly place anti-money laundering and countering the financing of terrorism (AML/CFT) obligations on VAs and VASPs. In July 2020, the FATF committed to update this Guidance as set out in its 12-month review report and report to G20 on stablecoins.
This revised document provides updated guidance in six main areas to
(1) clarify the definitions of VA and VASP to make clear that these definitions are expansive and there should not be a case where a relevant financial asset is not covered by the FATF Standards (either as a VA or as a traditional financial asset),
(2) provide guidance on how the FATF Standards apply to so-called stablecoins,
(3) provide additional guidance on the risks and potential risk mitigants for peer-to-peer transactions,
(4) provide updated guidance on the licensing and registration of VASPs,
(5) provide additional guidance for the public and private sectors on the implementation of the ‘travel rule’,
(6) include Principles of Information-Sharing and Co-operation Amongst VASP Supervisors. The Guidance has also been updated to reflect the passage of time and the publication of other relevant FATF reports.
These changes to the FATF’s pre-existing Guidance aim to maintain a level playing field for VASPs, based on the financial services they provide in line with existing standards applicable to financial institutions and other AML/CFT-obliged entities, as well as minimizing the opportunity for regulatory arbitrage between sectors and countries.
The Bureau may enforce the law by filing an action in federal district court or by initiating an administrative adjudication proceeding. Administrative proceedings are conducted by an Administrative Law Judge, who holds hearings and issues a recommended decision.
Comments