British Security Think Tank’s Report Warns NFTs Could Bolster Money Laundering Schemes

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British Security Think Tank's Report Warns NFTs Could Bolster Money Laundering Schemes

The Royal United Services Institute (RUSI), the British defence and information deliberation tank, questions whether oregon not non-fungible token (NFT) assets tin beryllium utilized for wealth laundering purposes. The study determines that successful bid to mitigate the wealth laundering risks a ‘know your customer’ monitoring strategy “needs to beryllium implemented.”

RUSI: ‘NFT Technology Can Raise Alarm Bells From a Money Laundering and Financial Crime Perspective’

The Royal United Services Institute for Defence and Security Studies different known arsenic RUSI, was founded successful 1831 and it is the oldest defence and information deliberation vessel worldwide. On December 2, RUSI published a report that covers the taxable of non-fungible token (NFT) assets and the RUSI researchers inquire whether oregon not NFTs tin lend to wealth laundering schemes.

“This exertion tin rise alarm bells from a wealth laundering and fiscal transgression perspective,” RUSI warns. “To commencement with, NFTs are astir often purchased with cryptocurrencies connected online marketplaces. Cryptocurrencies are routinely exploited for malicious means, specified arsenic obfuscating the root of transgression proceeds and, contempt transactions being traceable, much blase transgression actors usage a assortment of techniques to disrupt investigations by instrumentality enforcement.”

The RUSI study called “NFTs: A New Frontier for Money Laundering?” further states:

A strategy of ‘know your customer’ policies and ongoing monitoring, akin to those utilized successful the accepted creation marketplace and successful compliant cryptocurrency exchanges, needs to beryllium implemented.

Money Laundering Considered Commonplace successful Traditional Art Market — RUSI Researchers Say an ‘Art Heist Is Also Possible Within the NFT Realm’

Money laundering successful the accepted creation country has been an ongoing statement for decades. The New York Times investigative newsman Graham Bowley explained connected June 19, that U.S. politicians privation to analyse the concealed creation market. “Secrecy has agelong been portion of the creation market’s mystique, but present lawmakers accidental they fearfulness it fosters abuses and should beryllium addressed,” Bowley wrote.

RUSI researchers accent that transgression actors tin besides infiltrate NFT markets and leverage “novel risks.” “An creation heist is besides imaginable wrong the NFT realm,” the RUSI study adds. “Criminal actors tin hack into idiosyncratic accounts connected NFT marketplaces and transportation NFTs to their ain accounts. After transferring the NFTs, the hacker tin rapidly merchantability the stolen token(s) and effort to launder the proceeds.”

While RUSI researchers judge that wealth laundering successful the NFT creation and collectibles satellite tin beryllium deterred, the study besides highlights that “NFT forgery and theft tin besides beryllium mitigated.” RUSI suggests that NFT marketplaces usage two-factor authentication (2FA) solutions and support “good cyber security.” Furthermore, RUSI suggests processing a registry of stolen NFTs that “would mimic the Art Loss Register.”

What bash you deliberation astir the RUSI study connected NFTs and wealth laundering risks? Let america cognize what you deliberation astir this taxable successful the comments conception below.

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