Tech
India will ban URLs of 9 cryptocurrency exchanges, including Binance, for non-compliance with anti-money laundering law
The Financial Intelligence Unit (FIU), under India’s Ministry of Finance, has issued show-cause notices to 9 offshore cryptocurrency exchanges and asked the Ministry of Electronics and Information Technology (MeitY) to block their URL in India. The action was initiated for alleged non-compliance with Indian anti-money laundering legislation. According to the notice sent by FIU, these 9 cryptocurrency exchanges, including Binance and Kucoin, are operating illegally in India. The nine exchanges that received the show cause notice include Binance, Kucoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global and Bitfenex.
“As part of the compliance action against offshore entities, the Financial Intelligence Unit India (FIU IND) has issued Show Cause compliance notices to the following nine Offshore Virtual Digital Asset Service Providers (VDA SPs) under Section 13 of Prevention of Money Laundering Act, 2002 (PMLA),” reads the show cause notice.
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Virtual digital asset service providers, whether operating within or outside India, involved in activities such as currency exchanges from virtual digital assets to fiat currencies, transfers of virtual digital assets, custody or administration of virtual digital assets or facilitating control over virtual digital assets, they must register with FIU India as a “reporting entity”. They are obliged to comply with the requirements set out in the Prevention of Money Laundering Act (PMLA) 2002.
“The Regulation imposes reporting, record keeping and other obligations on Virtual Digital Asset Service Providers (VDA SPs) under the PML Act which also includes registration with FIU India,” the notice further reads.
As per the FIU notification, as of today, 31 SP VDAs have completed registration with FIU India. Nonetheless, a number of offshore entities, despite serving a significant portion of Indian users, have avoided registration and are therefore excluded from the scope of anti-money laundering (AML) and countering the financing of terrorism (CFT) regulations.
FIU India serves as the primary national agency tasked with receiving, processing, analyzing and sharing information related to suspicious financial transactions with foreign law enforcement agencies and financial intelligence units.
Published by:
Nandini Yadav
Published on:
December 29, 2023
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