According to a GFI report, Latam is still unprepared to handle cryptocurrency fraud and crime.

According to a new analysis from the Washington, DC-based think tank Global Financial Integrity (GFI), Latam is still unprepared to handle scenarios involving scams and crimes involving cryptocurrencies. The report claims that despite the proliferation of these new technologies, crypto regulation has not increased and that governments have frequently failed to identify and prosecute crypto-related crimes.

GFI: Crypto-Related Crime Still a Risk in Latin America
Due to the distinct economic circumstances and challenges faced by the nations in the region, bitcoin usage has increased significantly in Latam, but cryptocurrency regulation has not kept pace. One of the findings of a paper titled “Cryptocurrencies: A Financial Crime Risk inside Latin America and the Caribbean” that was released on November 14 is that it.

The analysis, written by Global Financial Integrity, a financial think tank based in Washington, DC, focused on nations with high crypto usage, such as Argentina, Brazil, Colombia, El Salvador, and Mexico, and investigated the legal cryptocurrency developments in Latam and the Caribbean.

The analysis identified a number of regulatory gaps in several of these nations that would enable criminals to utilize cryptocurrencies to perform money laundering offenses that wouldn’t be noticed by the police. The study adds that considering that Latam’s cryptocurrency adoption has different trends than that of other regions, some of these nations still need crypto-specific rules to address issues other than crypto taxation.

Recommendations for Policy
According to the study, it is crucial for these nations to recognize that cryptocurrencies are a novel asset class that necessitates research in order to build efficient policies that take into account the demands of each of the Latam nations. Another option that governments might use is to promote educational campaigns regarding cryptocurrencies and the potential risks that users and investors may encounter while utilizing these new currencies.

However, the report states that implementing KYC/AML (Know Your Customer/Anti-Money Laundering) procedures among service providers, which can help to spot potential dangers, is one of the most crucial measures that these countries must take.

In a similar vein, it is suggested that governments adopt the recommendations of international organizations like the Financial Action Task Force (FATF), along with the linking of these organizations to enable cooperation and the exchange of information that may result in the prosecution of criminal cases.

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