Ireland set to enforce stricter AML on crypto

Ireland set to enforce stricter AML on crypto

By Benson Toti - min read

These new laws are an expansion of the European Union’s AMLD-5 directive, focusing particularly on wallets and exchange platforms

The Irish Government is working on strengthening national cryptocurrency regulations, with lawmakers proposing the introduction of a new set of anti-money laundering laws.

According to local reports, the new laws are expected to focus on the use of cryptocurrencies in illicit financial activities, such as money laundering and terrorist financing.

The new bill that is currently under consideration will place crypto businesses under the arm of government agencies, as part of a planned expansion of the European Union’s (EU) fifth anti-money laundering directive (AMLD-5) to also include the cryptocurrency industry. It will focus specifically on wallets and exchange platforms.

The Irish Examiner also reported that the Minister of Justice, Helen McEntee, announced that she had already received support from the Cabinet to publish the Money Laundering and Terrorist Financing Amendment Bill 2020.

Cryptocurrencies aside, the new bill would also prevent banks in Ireland from setting up anonymous safety deposit boxes. This is due to concerns from local authorities regarding the activities of rogue actors that have been “passporting” illicit funds across the continent by relying on the EU’s internal open border policy. As a result, lawmakers also plan on including provisions for the proper identification of corporate entities.

The new regulations may make it more difficult for crypto enthusiasts to set up a base in the country, especially when considering the cost of completing compliance measures. In the past, commercial banks in the country have been accused of crypto profiling and refusing to offer services to cryptocurrency businesses.

This is allegedly due to delays in transposing the AMLD-5 into law in the Republic. The delays are caused by the general election and deadlocks between political parties.

Boinnex, a provider of Bitcoin ATM machines, recently had its account with AIB closed. According to the company’s founder, Bryan Tierney, they were informed that “entering into a formal relationship with entities carrying out this type of business activity is outside of our risk appetite at this time”.

“We’ve been forced to get a banking partner abroad. A lot of companies in the space are in a similar situation. Some of these foreign banks charge exorbitant fees as they know they’re the only show in town,” Tierney explained.

Tierney also pointed out that the hesitation for banking providers to provide services to cryptocurrency companies was a stark contrast to the state’s promotion of the emerging industry.

Both the AIB and the Bank of Ireland have denied suggestions that they are discriminating against crypto companies.