Virtual Assets– Emerging risk of Money laundering and Terrorism financing
The Financial Monitoring Unit (FMU) is the central authority in Pakistan to receive, analyze and disseminate suspicious transaction reports (STRs) and Currency Transaction Reports (CTRs). The FMU conduct two types of Analysis i.e. Tactical Analysis and strategic Analysis of STRs/CTRs. The purpose of strategic analysis is to identify potential ML/TF threats and vulnerabilities of products, customers, geographies and delivery channels for the stakeholders to proactively deter the emerging risks.
The objective of this strategic analysis is to understand the virtual assets, underlying mechanism for transferring value and risks/vulnerabilities associated with such assets. The strategic analysis is based on different domestic and international reports on virtual assets and the suspicious transactions reports received to FMU during the year 2019. The report covers the demographics and geographic analysis of individuals involved in virtual assets and products/ delivery channels used by them to perform transactions of virtual assets. Further, the report also tends to identify possible predicate offences linked with virtual assets with help of case studies.
The ultimate purpose of the study is to assist the financial sector, regulators, law enforcement agencies and other stakeholders to develop legal/regulatory framework to govern the virtual assets.