Daily Dash: Binance Fined C$6m For AML Failures In Canada

May 10, 2024
Binance has been hit by another AML penalty, this time in Canada, while Sweden’s financial regulator has disclosed that it is investigating possible AML failures at payments firm Zimpler.

Binance Fined C$6m For AML Failures In Canada

Binance’s global platform has been issued a C$6m ($4.4m) fine by a federal regulator in Canada for non-compliance with anti-money laundering (AML) regulations.

On Thursday (May 9), the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) stated that Binance failed to register as a foreign money services business as required.

In addition, Binance failed to report large virtual currency transactions of C$10,000 ($7,300) or more in the course of a single transaction, together with the prescribed information.

FINTRAC noted that its administrative monetary penalties are meant to be “non-punitive” and are issued to “encourage change in the non-compliant behaviour of businesses”.

In 2023-24, FINTRAC issued 12 non-compliance notices to businesses and total penalties of C$26m ($19m).

Swedish Regulator Investigates AML Concerns At Zimpler

Sweden's financial regulator has announced that it is investigating the payments firm Zimpler. 

According to the Financial Supervisory Authority (FI), its staff are investigating how Zimpler complies with anti-money laundering (AML) regulations. 

"The gaming industry is considered to run a high risk of being used for money laundering and terrorist financing, which places special demands on those who are exposed to it," the regulator said. 

"Since Zimpler has a significant exposure to the gaming industry, FI is now starting an investigation to review how the company counteracts being used for money laundering and terrorist financing."

The investigation covers the company's general risk assessment, procedures for customer awareness, risk assessment of customers and customer awareness measures.

India Agrees To Build 'UPI-Like' Payment System In Namibia

The international arm of the National Payments Corporation of India (NPCI) has signed an agreement with the Bank of Namibia to support it in developing a “UPI-like” instant payment system.

The new system aims to improve accessibility, affordability and interoperability with both domestic and international payment networks by 2025.

NPCI said the “robust” security features of UPI will instill user confidence and will ensure scalability as transaction volumes grow and as other innovations are built on top.

“Once live, the platform will facilitate digital transactions in Namibia, driving financial inclusion and reducing cash dependency by catering to underserved populations,” it said.

European Banking Authority Publishes Final Set Of Draft MiCA Standards

The European Banking Authority (EBA) has published three sets of final draft regulatory technical standards (RTS) and one set of final draft implementing technical standards (ITS). 

These relate to the authorisation of issuers of asset-referenced tokens (ARTs), i.e. stablecoins.

They also cover information for the assessment of acquisition of qualifying holdings in issuers of ARTs, and procedures for the approval of white papers for ARTs issued by credit institutions under the Markets in Crypto-Assets (MiCA) regulation.

Provisions relating to ARTs are enforceable from June 30, 2024, and these technical standards focus on clarifying issues such as whether ART issuers need to be based in the EU and application templates for issuing an ART.

Hong Kong Launches New Wholesale CBDC Project

The Hong Kong Monetary Authority (HKMA) has announced the launch of the Project Ensemble Architecture Community, an initiative to encourage public-private sector collaboration in the development of Hong Kong’s tokenisation market.

The central bank said the forum aims to develop a set of industry standards to support interoperability among wholesale CBDC (wCBDC), tokenised money and tokenised assets. Its private sector members include Ant Financial, Microsoft and HSBC.

The community will make recommendations on specific topics, initially focusing on setting up a mechanism to support seamless interbank settlement of tokenised deposit via wCBDC for tokenised asset transactions.

The community will also assist in the design and implementation of the Project Ensemble Sandbox, which is expected to launch by mid-2024, to facilitate further research and testing of tokenisation use cases.

Argentina Launches New API To Tap Into Central Bank Information

The Central Bank of Argentina (BCRA) has developed and released a new application programming interface (API) for businesses to access information produced by the central bank.

The API is the first of its kind and can be used in website construction and in business applications and systems.

The central bank said the API will allow businesses to automate their retrieval of information from the regulator, thereby reducing costs and simplifying access for decision-makers.

“This is an important step towards open finance, a global trend that helps to improve the flow of information in the financial system,” said the central bank.

The BCRA said its next available APIs will cover exchange rates, bounced checks and data on debtors.

Federal Reserve Considers Extending Fedwire Service Hours

The US Federal Reserve has requested comments on its possible extension of its two large value payments services, Fedwire Funds Service and the National Settlement Service, to include weekends and holidays. 

Currently, the wholesale payment service operates from Monday until Friday, excluding holidays, and Federal Reserve is now consulting on this extension for the next 60 days. 

If it is implemented, payment service providers will be able to make use of the expanded operating days on a voluntary basis. 

European Banking Authority Starts Collecting Information On Money Launderers

The European Banking Authority has said that it will begin to collect information on natural persons this month on its anti-money laundering (AML) database, EuReCa. 

If a person is linked to financial crime, supervisors will now be able to report the information to EuReCa. 

Supervisors will also be able to report the name of a member of the management body or a key function holder in a financial institution, if necessary, because a lack of honesty or integrity can cause or lead to serious problems in a financial institution’s governance arrangements, business model or activities and ultimately, weaken the institution’s AML defences.

Since its launch on January 31, 2022, 41 authorities have made more than 1,400 reports to EuReCA.

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